U.S. stocks closed higher on Friday after the Senate took a step toward achieving tax reform.
An incredible comeback in General Electric shares from a 6 percent deficit to positive also helped lift market benchmarks. Some investors bet the worst is over for the troubled conglomerate which reported abysmal earnings Friday morning and cut its forecast for the year.
The Dow Jones industrial average rose 165.59 points to 23,328.63, reaching intraday and closing records. Boeing and Goldman Sachs both rose about 2 percent to lead advancers. Shares of JPMorgan Chase, meanwhile, hit an all-time high after jumping 1.4 percent.
The S&P 500 also notched record highs, advancing 0.5 percent to close at 2,575.21 as financials led advancers by rising 1.2 percent.
PayPal was among the best-performing stocks in the index, rising 5.5 percent after the company reported better-than-expected quarterly results.
The Nasdaq composite gained 0.4 percent to 6,629.05 in a record-setting session.
The Dow, S&P and Nasdaq also posted weekly gains of 2 percent, 0.9 percent and 0.35 percent, respectively.
The Republican-led Senate approved a $4 trillion budget measure Thursday by a 51-49 vote. Passing a budget unlocks reconciliation, which enables the GOP to pass a tax bill with a simple 51-vote majority in the Senate. Using the tool removes the need for winning Democratic support, which would likely sink a GOP tax measure.
"The market was actually very excited about tax reform last year after the election. But come the first half of the year, those expectations dropped," said Rui De Figueiredo, CIO and co-head of the Solutions/Multi-Asset Group at Morgan Stanley Investment Management.
"Recently, expectations of tax cuts started to creep back in," he said. "The Republicans are so on the hook to get something done that those in-party divisions are likely to be resolvbed in order to get tax reform done."
The three major indexes had a banner week, posting record highs. The Dow also broke above 23,000 for the first time ever this week.
"We continue to set new highs and that does put people on edge at times," said Tom Anderson, chief investment officer at Boston Private.
"We've gone a long time without a 5 percent correction. But we continue to be bullish on stocks. We think this stock market is supported by fundamentals," Anderson said.