Stocks traded higher on Thursday, predicting the result of an election-week rally would split the government, as Democratic challenger Joe Biden came close to an electoral college victory over President Donald Trump and retained control of the Republican Senate Chance appeared.
The continued talling of the election results was likely to see a policy statement by the Federal Reserve when its rate-setting committee concluded its meeting on Thursday.
What are the major benchmarks?
Dow Jones Industrial Average DJIA,
Up 586.48 points or 2.1% at 28,434.14, while the S&P 500 SPX,
It traded up 76.44 points or 2.2% to trade at 3,519.88. Nasdaq Composite Comp,
It was up 258.27 points or 2.3% at 11.249.05.
The Dow rose 367.63 points or 1.3% to close at 27,847.66 on Wednesday, while the S&P 500 advanced 74.28 points, or 2.2%, to close at 3,443.44. The Nasdaq Composite closed up 430.21 points or 3.9% at 11,590.78. The gains for the S&P 500 and Nasdaq marked the biggest jump for Election Day since Record Day.
What is driving the market?
Continued reaction to the results so far “may be due to the fact that Republicans are likely to retain a majority in the Senate, something that would make it harder for Biden to move forward with tax hikes and strict rules that he promised Was, “Charalambos Pisoros, senior market analyst for JFD Group, in a note.
Biden won Michigan and Wisconsin on Wednesday, putting him away from the 270 needed to win six votes, while prospects for Democrats to control the Senate faded.
Moving into the polls, analysts had argued that the “Blue Wave” or Democratic sweep of both the White House and Congress was being priced into the market, which had come to a halt in the hope that such a result would help financially. The path will be cleared for another big round. Coronaviruses support economic recovery from the epidemic. However, investors appeared disappointed with the prospect of a divided government.
“Positive equity market reaction reflects some reduction in uncertainty, as investors now know more about potential outcomes and possible policies,” said Mark Heffel, chief investment officer of UBS Global Wealth Management, in a note.
While there remains some uncertainty around the election results and the Trump campaign suppresses legal challenges, Haefel noted the Coby Volatility Index Ricks,
A measure of expected volatility in the S&P 500 over the next 30 days, has continued to retreat in view of the results. The index was down about 2 points at 27.12 after trading in the mid-30s on Election Day, a sign that concerns have faded around an election. The index has a long-term average of about 19.
Analysts said the continued rise in COVID-19 cases is a concern. The number of daily new American infections set a record above 100,000 on Wednesday, while an increase in the spread of the virus prompted a tight lockdown in European countries.
Meanwhile, the Federal Reserve hopes to drop the policy when it makes a statement on its meeting at 2pm Eastern, followed by Chairman Jerome Powell’s news conference at 2:30 pm, with Powell and other Fed officials taking more fiscal action than before Is pushed to leave the economy behind.
Read: Impressed by the election, the Fed’s goal is to keep it that way
On Thursday in the US economic data, the Department of Labor reported for the first time revised unemployment benefit claims to fall from 751,000 to 7,000 last week.
Which companies are the focus?
Shares of Qualcomm Inc.
The chipmaker’s quarterly results and outlook jumped 13% after previous Street Street estimates as it benefited from the 5G product rollout.
Expedia Group Inc.
The travel company said late Wednesday that third-quarter sales had fallen by more than half, but the shares rose more than 2% after COVID-19 managed to reduce losses compared to the earlier stages of the epidemic .
Shares of Alibaba Group Holding Limited
The Chinese e-commerce giant was down 5% on Thursday morning despite delivering strong-to-expected earnings.
Regeneron Pharmaceuticals Inc
Shares fell 0.6% after the drug company easily topped third-quarter estimates and said it had shared data from regulators with its Phase 2/3 COVID-19 vaccine candidate trial.
Shares of Bristol-Myers Squibb Co.
The drugmaker reported a 0.9% drop for the third quarter despite expectations of a massive beating.
Cigna Corp. CI,
The shares rose 3% when the health insurer expected third-quarter profit and revenue, which provided a full-year outlook, while not surprising.
The third-quarter profit rose 1.7% after the auto maker exceeded expectations, as sales in the US and China rose faster than COVID-19-related weakness.
What are other markets doing?
TMUBMUSD10Y, yield on 10-year Treasury note
Little was changed at 0.767%.
Stoxx 600 Europe Index SXXP,
Was up 1.1%, while London’s FTSE 100 UKX,
Oil futures lost ground with US benchmark CL.1,
$ 38.98 per barrel, while gold GC00, down 0.5%
Cotton rose 2.6% to $ 1,945.30 an ounce.
ICE US Dollar Index DXY,
A measure of the currency, against a basket of six major rivals, slipped 0.7%.