With 10 Dow records in a row, it wouldn't be a surprise if Wall Street's bull caught its breath in the near future.
Stocks closed mixed Thursday, but the Dow was the leader, in its longest streak of record closes since the first 13 trading days of 1987, when it had 12 records. Traders often wince when 1987 is mentioned since it is remembered well as the year of the famous October stock market crash.
"We're due for at least a rest, if not a correction. We're way overbought," said Steve Massocca, managing director with Wedbush Securities. Massocca said the market will continue to focus on data, with a truck load of reports next week on everything from fourth-quarter GDP to inflation and auto sales. The other focus, of course will be on Washington.
Markets are looking forward to a light data calendar Friday, with new home sales and consumer sentiment at 10 a.m. ET. Earnings reports are expected from J.C. Penney, Foot Locker, Cabot Oil & Gas, Trivago, Public Service and EchoStar, among others, before the opening bell.
As it has since January, market focus will remain on the process and progress of Trump administration policies, particularly tax reform. Treasury Secretary Steven Mnuchin appeared on CNBC Thursday, and while he could not provide details of a tax plan, he said the administration is working with Congress to have a combined plan by August.
President Donald Trump's comments to Reuters late Thursday gave new life to the idea that a border-adjusted tax could be included in the plan when he said, "I certainly support a form of tax on the border." Trump said it could lead to new jobs in the U.S. But Trump has also said previously the specific border-adjusted tax is too complicated, and Mnuchin said there were both positives and negatives in the plan.
"Half of what the market is trading on is getting corporate tax rates down, in a nutshell. That would be bullish for earnings, and that's unambiguous," said Art Hogan, chief market strategist with Wunderlich Securities.
Under the House tax plan, the border-adjusted tax would tax all imports coming into the country and not tax exports at all. When news of Trump's comment hit the market, retail shares fell. Retailers and other importers are opposed to the tax and say it would be a tax on consumers, but industrial companies favor it. The tax is not expected to pass the Senate, so it's important whether Trump throws his support behind it.