Wall Street up as progress in Trump's tax plan lifts hopes

U.S. stocks extended gains in early afternoon trading on Friday to scale new highs on hopes that President Donald Trump's tax-cut plan would make further headway after the Senate passed a budget resolution.

The Senate on Thursday approved a budget blueprint for the 2018 fiscal year, paving the way for the Republicans to pursue a tax-cut package without Democratic support.

"It clearly is a positive and has added to the sentiment," said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management in Minneapolis.

"Any legislative action that promotes economic growth, clearly will be additive to not only sentiment but presumably earnings."

The S&P and the Dow were on track to post gains for the sixth straight week and the Nasdaq for the fourth straight week.

Third-quarter earnings season is under way and 183 S&P 500 companies are expected to report earnings next week. So far, more than 70 percent of the 88 S&P 500 companies have beat profit expectations.

At 12:50 p.m. ET (1630 GMT), the Dow Jones Industrial average was up 120.75 points, or 0.52 percent, at 23,283.79, the S&P 500 was up 9.63 points, or 0.38 percent, at 2,571.73 and the Nasdaq Composite was up 29.94 points, or 0.45 percent, at 6,635.00.

Financial stocks - expected to benefit from the administration's proposed policies - rose 1.12 percent and was the best performer of the 11 major S&P sectors.

Bank of America's 2 percent jump led the financials while a 0.78 percent rise in the tech index was led by gains in Microsoft and Apple.

PayPal's 4.1 percent rise after upbeat earnings also lifted the tech stocks.

Procter & Gamble dipped 4.15 percent and weighed on the consumer staples sector after the company's sales missed estimates on weakness in its Gillette business.

Celgene slumped more than 10 percent after the company abandoned testing a drug to treat Crohn's disease.

Advancing issues outnumbered decliners on the NYSE by 1,609 to 1,209. On the Nasdaq, 1,843 issues rose and 1,001 fell. (Reporting by Sruthi Shankar in Bengaluru; Editing by Arun Koyyur)