Wall Street Rallies on US elections; Tech, Health Shares Lead
NEW YORK – Wall Street grew 2 percent on Wednesday, led by technology and healthcare, as investors breathed a sigh of relief after the United States mid-term election and announced that a split congress would be good news for stocks.
Democrats won control of the House of Representatives on Tuesday, while President Donald Trump's Republican Party expanded its Senate majority, pointing to the likelihood of political gridlock in Washington.
S & Ps's biggest increases came from the S & P technology sector and health centers, with both indexes increasing 2.9 percent. The consumer's discretionary sector increased 3.1[ads1] percent, with an increase of 6.9 percent in Amazon.com shares. Amazon gave the biggest boost to S & P 500.
"Now we are in an environment that people can understand again so they will be willing to put some money back on the table. There was a little fear out there," said Peter Tuz, president of Chase Investment Counsel Corp in Charlottesville, Virginia.
Dow Jones Industrial Average rose 545.29 points, or 2.13 percent to 26.180.3, the S & P 500 gained 58.44 points, or 2.12 percent to 2.813.89, and the Nasdaq Composite increased 194.79 points, or 2.64 percent to 7.570.75. [19659002] The CBOE Volatility Index, the most closely-followed meter of expected S & P 500 short-term surges, concluded 3.55 points at 16.36, the lowest industry for about a month.
While a split congress will make it harder for President Donald Trump to push through new legislation as additional tax cuts, investors expected not to reverse tax cuts and deregulation already adopted under Trump.
"This outcome is probably the most paralyzing for new policies," said Brian Nick, chief investment strategy for Nuveen Asset Management in New York, adding that growth sectors such as technology and healthcare will continue to be strong.
"In a scenario where there are no (extra) fiscal stimulus and we are not experiencing serious growth problems in terms of contraction, they are the best option," he said.
Some strategists said that democratic control of the house implies that Trump will have a harder time to support the efforts to impose new rules on Amazon.com.
Even though technology and health conditions increased, more investors asked about the sectors
Even after Wednesday's profits, S & P 500 was 4 percent below the record in September when investors watched rising interest rates and trade wars in the US and China.
] The Federal Reserve started a two-day monetary policy meeting on Wednesday, but no interest rate increase was expected when it issued its political decision on Thursday. Fed is expected to raise prices in December, at its last political meeting of the year.
Health insurance companies Humana Inc, Anthem Inc and UnitedHealth Group Inc. jumped to record height as voters in three states approved to expand Medicaid programs for low income people.
DaVita Inc. jumped 10.9 percent after California rejected a proposal to limit prices as dialysis clinics may require commercially insured patients.
Anadarko Petroleum Corp. rose 5.7 percent and Noble Energy Inc received 4 percent after Colorado voters rejected a tougher Oil and Gas Drilling Rule, which asked shares of companies operating in the state.
Accelerating issues were lower on NYSE with a 3.27-to-1 ratio; At Nasdaq, a 2.31 to 1 ratio preferred promoters.
The S & P 500 posted 35 new 52-week highs and three new downs; Nasdaq Composite registered 67 new heights and 71 new downs.
On US stock exchanges, 8.0 billion shares changed compared with the average of 8.64 billion for the last 20 sessions.
(Further Reporting by April Joyner, Saqib Iqbal Ahmed and Caroline Valetkevitch in New York, Sruthi Shankar in Bengaluru, Additional Reporting by Medha Singh, Editing Cynthia Osterman and Leslie Adler)
