Shares of the country’s biggest banks—including JPMorgan Chase JPM, Bank of America BAC, Citigroup C, and Wells Fargo WFC—surged on Monday morning after the Senate finally passed its tax bill over the weekend.

The reform package, which—among other things—slashes the corporate tax rate to 20% from 35%, inspired the bulk of last week’s trading, including a noticeable rally in the aforementioned bank stocks. Now, these financial behemoths are moving even higher as investors become increasingly optimistic that some form of the bill will eventually become law.

Bank of America, Citigroup, and Wells Fargo were all up more than 2% in morning trading Monday. Shares of JPMorgan also gained more than 2%, touching a new all-time high of $108.40 in the process. Elsewhere, investment behemoth Goldman Sachs GS was up over 1.5%, while smaller national banks like PNC PNC, Comerica CMA, and Fifth Third FITB were also in the green.

The Dow Jones Industrial Average, of which Goldman Sachs and JPMorgan are components, moved more than 1.2% higher in early morning hours. The SPDR KBW Regional Banking ETF KRE gained over 2.5%, and the Financial SPDR XLF surged about 2%.

On top of the tax reform bill, investors seem excited about direction of the Federal Reserve. Last week, confirmation testimony from Fed chair nominee Jerome Powell all but confirmed another interest rate hike at the central bank’s next policy meeting.

Trump’s pick to succeed Janet Yellen also hinted that he believes deregulation might be necessary in today’s banking industry (also read: 5 Bank Stocks to Buy on Jerome H. Powell Testimony).

Meanwhile, the tech-heavy Nasdaq Composite Index was in the red on Monday, supporting the thesis that investors may finally be cashing out of the red-hot sector. Tech has dominated Wall Street throughout 2017, but as geopolitical tensions continue to rise, large funds may be shifting to the seemingly less-volatile financial world.

Looking ahead, the banking rally will depend on the Fed’s monetary policy, so in addition to the rate cut, investors will want to pay attention to what the nation’s top economists say about 2018. If the tax bill passes, these bank giants could see an improvement to their bottom lines next year, but other factors could always have an influence.

Want more stock market analysis from this author? Make sure to follow @Ryan_McQueeney on Twitter!

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J P Morgan Chase & Co (JPM) : Free Stock Analysis Report
 
PNC Financial Services Group, Inc. (The) (PNC) : Free Stock Analysis Report
 
Comerica Incorporated (CMA) : Free Stock Analysis Report
 
Fifth Third Bancorp (FITB) : Free Stock Analysis Report
 
Wells Fargo & Company (WFC) : Free Stock Analysis Report
 
Citigroup Inc. (C) : Free Stock Analysis Report
 
Bank of America Corporation (BAC) : Free Stock Analysis Report
 
Goldman Sachs Group, Inc. (The) (GS) : Free Stock Analysis Report
 
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SPDR-KBW REG BK (KRE): ETF Research Reports
 
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