The Russell 2000 fell sharply on Monday following a report that the House of Representatives was considering phasing in a cut to corporate taxes, rather than enacting them immediately. The index of small-capitalization companies was down 1.3%, on track for its biggest one-day drop since August. Bloomberg reported that the House was discussing a “gradual phase-in for the corporate tax-rate cut that President Donald Trump and Republican leaders want — a schedule that would have the rate reach 20 percent in 2022.” The Russell is more closely correlated to tax-reform news given its components tend to have more U.S. revenue exposure than their larger multinational peers. The Dow Jones Industrial Average fell 0.4% on Monday while the S&P 500 was down 0.4% and the Nasdaq Composite Index was off 0.3%.
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