US stocks close higher as Boehner pulls fiscal cliff Plan B

The major US stock indices closed higher last night (December 20th) before the Republican Party decided to pull its Plan B proposal for resolving the fiscal cliff issue.

Despite only posing the notion of the tax bill on Tuesday, House of Representatives speaker John Boehner has cancelled the vote on the matter, with analysts indicating this rejection has weakened his standing in negotiations with the White House.

The bill would have raised taxes on high earners, but it was shunned by the Grand Old Party.

There are just two weeks to go until US decision-makers have to take action to avoid the fiscal cliff, but this latest setback will not help to allay concerns the White House and Republicans could fail in their negotiations.

At close of play last night, the Dow Jones Industrial Average rallied by 0.4 per cent to an index value of 13311.7 points and the technology-heavy Nasdaq rose by 0.2 per cent to an index value of 3050.3 points.

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