The US presidential election remains undecided, but it has not stopped the stock market from taking aim at its best day since the election in more than 100 years.
Dow Jones Industrial Average DJIA,
Nearly 705 points, or 2.6%, on Wednesday morning, near 28,185, was near a high on Wednesday, which would represent the fastest daily gain for the 124-year-old benchmark, as 3.33% returns since the 1900 presidential race Won Democratic opponent William Jennings Bryan by Republican President William McKinley.
Read: Trump, Biden Race Goes Into Overtime As Battlegrounds Remain In Balance: Live Blog
The 2020 race between President Donald Trump and former Vice President Joe Biden is close to being called a day after the election. There are several ways to win for each candidate.
If Biden won Nevada, Michigan and Wisconsin while Trump competed in other outstanding races, the Democratic challenger would get a bare minimum 270 electoral votes. Biden could also reach 270 if he won in Maine’s second congressional district, Nevada, North Carolina, and Wisconsin, as Trump thinks other states have not called yet.
See: Here we know about the eight states whose electoral college votes have not been called.
The tight race assumes a wide margin of victory that was implied by the polling data leading the race for the Oval Office. Those elections pointed to a so-called blue wave, which resulted in Democratic sweep and White House majorities not only in the House, but also in the Senate.
While that outcome was not put into effect, Wall Street is betting that Biden would win one and retain majority control of the Republican Senate. This scenario is seen as positive for equity markets for the long term as it will limit Biden’s ability to raise corporate taxes, roll back Republicans’ 2017 tax overhaul, and tougher regulations on industries including technology Will implement
Meanwhile, the S&P 500 Index SPX,
The Dow Jones was up 3.2% according to market data and was tracking its most powerful postelection day surge on record.
Nasdaq Composite Index Comp,
Was 4.2%, which would also be the index’s best return since a presidential election on record. To be sure, the Nasdaq Composite was first published in 1971 and the S&P 500 in 1957, leaving both significantly below the Dow.
Whether the market’s reaction to an uncontested election still remains an enigma to many market participants. However, many traders are arguing that the stock market is a forecasting system that rarely trades on the news of the day.