Wall Street rallies on U.S. elections lead by tech, health stocks
U.S. stocks surged on Wednesday with broad gains led by the technology and healthcare sectors as investors, relieved to put midterm elections behind them, made bets that a divided Congress would be good for equities.
Democrats won control of the House of Representatives on Tuesday, while President Donald Trump`s Republican party expanded its Senate majority, pointing to a political gridlock in Washington.
The S&P`s biggest boosts came from the S&P technology sector <.splrct>, which rose 2.4 percent, and the healthcare index <.spxhc>, which gained 2.8 percent as investors were more comfortable taking on risky bets. The consumer discretionary sector <.splrcd> was also a strong gainer as Amazon.com
“I don’t think any of Trump’s agenda that he’s already accomplished gets unwound. That was the main point of concern for investors,” said Robert Phipps, a director at Per Stirling Capital Management in Austin, Texas. “We’ve got a relief rally because the market got exactly what it expected.”
At 2:53PM ET, the Dow Jones Industrial Average <.dji> rose 444.78 points, or 1.74 percent, to 26,079.79, the S&P 500 <.spx> gained 47.9 points, or 1.74 percent, to 2,803.35 and the Nasdaq Composite <.ixic> added 162.37 points, or 2.2 percent, to 7,538.34.
While a divided Congress will make it harder for Trump`s administration to push through new legislation such as additional tax cuts, investors were not expecting a reversal of tax cuts and deregulation measures that have already been enacted.
Some strategists said Democratic control of the House means President Donald Trump would have a harder time gaining support for efforts to impose more regulations on Amazon.com
But even as technology and healthcare stocks soared, investors questioned whether the sectors could now be more at risk of additional regulatory scrutiny.
Following a steep selloff in October, the S&P 500 was still roughly 5 percent below its record high reached in December, as investors still had their eyes on rising interest rates and a U.S.-China trade war.
The Federal Reserve began its two-day monetary policy meeting on Wednesday, but was not expected to raise rates until December.
Bank stocks <.spxbk> were up but underperforming the broader market as Treasury yields slipped and investors bet that the divided Congress would hamstring any efforts for additional fiscal stimulus. [US/]
Health insurers Humana Inc
Anadarko Petroleum Corp
Among the laggards were luxury handbag maker Michael Kors Holding Ltd
Advancing issues outnumbered declining ones on the NYSE by a 3.07-to-1 ratio; on Nasdaq, a 1.90-to-1 ratio favoured advancers.
The S&P 500 posted 34 new 52-week highs and 3 new lows; the Nasdaq Composite recorded 61 new highs and 61 new lows.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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