Wall Street rallies again with election week continuing


The aftermath of the Wall Street election strengthened stocks again on Thursday, pushing the S&P 500 towards its biggest weekly gain since April.

Markets are banking in Tuesday’s election Leading to Congress’ divided controls, meaning lower tax rates, lighter regulation on businesses and other policies that keep investors in the status quo. It is still unclear who will run the White House next year, although Democrat Joe Biden is pushing for the required mark as the counting of votes continues in several major states.

The S&P 500 rose 1.9%, its fourth straight gain of over 1%, and is now 7.4% for the week. February and March would be its best week since the market exploded in panic about the cronovirus epidemic.

Baird’s investment strategist, Ross Mayfield, said, “The presidential election has not been decided, the Senate has not been settled, but we are getting a post-election rally.” “The odds seem largely set in stone at this point, so investors are feeling very comfortable placing bets that they are making.”

The S&P 500 gained 67.01 points to close at 3,510.45. The Dow Jones Industrial Average rose 542.52 points, or 1.9%, to 28,390.18 points. The Nasdaq Composite climbed 300.15 points or 2.6% to 11,890.93 points. Small company stocks also showed strength. The Russell 2000 small-cap index rose 44.96 points, or 2.8%, to 1,660.05 points.

The index and US bond yields remained stable after the Federal Reserve released its latest monetary policy update. The central bank said it would leave its key interest rate near zero at a record low. It reaffirmed its readiness to do more if the economy needed to be endangered by the worsening coronavirus epidemic.

Technology stocks helped power the rally, as they have for years through and before the epidemic. Hopefully Republicans can hold on to Senate Investors are reducing concerns that a Democratic-controlled Washington will implement antitrust laws and move more aggressively after Big Tech.

Apple climbed 3.5%, Microsoft rose 3.2%, and Amazon added 2.5%. Facebook grew 2.5% and Google’s parent company by 1%. They are also the five largest stocks in the S&P 500 by market value.

In many states, shares of cannabis companies rose higher after voters and paved the way for the sale of legal marijuana for adult or medical use. Tilre jumped 30.3%, although the stock is down 54.4% so far this year.

Broadly, markets are looking at congressional division control over what Mizuho Bank calls “Goldilocks gridlock”.

Investors see reason for optimism if either Biden or President Donald Trump eventually win the presidency, and all they want is for it to be a clear winner. The stars “Barclays strategists wrote in a report” fear uncertainty rather than the actual outcome.

But the expectation with which Biden has a chance to win has also raised hopes that Amber Hill Capital’s asset management director Jackson Wong said US foreign policies may be “more explicit”. He said, “Investors are happy for this. So the markets are doing well.”

Stocks also rose in European and Asian markets on Thursday.

Wall Street’s rally was widespread, with the S&P 500 having about 82% more stock. Qualcomm jumped 12.7% to one of the biggest gains in the index, as it reported stronger revenue and profit for the latest quarter than analysts.

This is the strongest trend through this earning season, which is close to wrapping up. S&P 500 companies are reporting a decline in profits from the 8% level on an annual basis. Wall Street was much more modest compared to a drop of nearly 21% at the beginning of last month.

Nevertheless, many analysts warn that volatility may escalate further. Big swings may come back as a threat to elections, with body elections still looming.

Trump’s campaign poses legal challenges In some major swing states, though it is unclear whether they can move the race in their favor. Analysts say a long court battle without a clear winner of the presidency could increase uncertainty and drag the stock down.

But concerns about any major changes in tax policy during the next administration have now been dispelled that Congressional control looks like it will split, said Megan Hornman, director of portfolio strategy at Vardens Capital Advisors .

“History tells us that investors prefer gridlock because there really isn’t a big chance of legislative surprise,” she said

Washington’s division control also bears a possible decline. For example, the possibility of a gridlock may be reduced when the US government comes together to give a big shot of stimulus to the economy.

The yield on the 10-year Treasury remained stable at 0.77%. It was above 0.90% earlier this week, when markets were still thinking that a Democratic sweep was possible which could become a major stimulus package for the economy.

Epidemic With increasing rates of distress across Europe and the United States, economies around the world continue to weigh. Many European governments have withdrawn restrictions on businesses in hopes of slowing the spread.

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AP Business Writer Elaine Kurtenb contributed.

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