Markets throw a welcome party of sorts for Biden

Joseph R. by the Trump administration A day after Biden Jr.’s election was effectively accepted, investors showed their relief on Tuesday by pushing two major stock market indices to an all-time record.

It was a welcome party for Mr. Biden, but the end of uncertainty that investors were really embracing. President-elect Biden has vowed to push for more incentives to strengthen the economy. Treasury Secretary, Janet L. His selection for Yellen has been known as the Federal Reserve chair since his days. And many new coronovirus vaccine candidates mean the epidemic may be under control in the coming months.

President Trump, who is on a campaign trail, warned that Mr Biden’s election would boost stock market Armageddon, speculating on Tuesday that the day’s height was doing his own, making an undetermined stop at the White House Briefing to play the latest benefits for. Dow Jones Industrial Average.

“The stock market’s recently broken 30,000, never broke,” said Mr. Trump, who has used the markets as his presidential barometer. “It is a holy number, 30,000; Nobody thought they would ever see it. “He said:” I want to congratulate all the people within the administration who worked so hard. And most importantly, I want to congratulate the people of our country, because there are no people like you. “

Mr. Trump, who spoke for about 65 seconds, did not heed the question to reporters whether he would accept Mr. Biden.

On Wall Street, the S&P 500 stock index rose 1.6 percent to a new high of 3,635.41, while the Dow rose 1.5 percent, up from 30,000 for the first time.

“We have a certain amount of months ago that we didn’t have,” said Christina Hooper, chief global market strategist at Invesco, an investment management firm.

The last few months have been volatile for investors. After hitting a peak on 2 September, the S&P 500 began to fall, and – except for a short time the following month – remained down about 9 percent from the peak until the end of October.

One sign of investor concern was the volatility displayed in VIX, an index widely known as Wall Street’s “fear gauge”. The VIX rose more than 50 percent at the end of October as the virus picked up again and the election drew near. A slump of technology stocks added to the uncertainty. The stock dropped 5.6 percent in the last week of October, the largest weekly decline since March. Nevertheless, stocks were up for the year at the end of last month.

And shares have climbed steadily in the week since the election, mainly due to encouraging vaccine news. Pfizer, Modern and AstraZeneca have all announced that their vaccine candidates showed favorable results in the tests. The S&P 500 has grown by about 8 percent since the election. Some investors believe that with Mr. Biden in the White House, and likely for Republicans to retain control of the Senate, they can rely on political gridlock to block tax hikes that could seep into markets .

“You have the potential to be governed by a divided Congress and a conservative Supreme Court, so it eliminates some extreme policies to the right or left,” said Michael Aaron, chief investment strategist at State Street Global Advisors. “So the markets are celebrating that.”

The good news about the vaccines has damaged stocks that were hit by the outbreak. Stocks of airlines and oil companies have gone up this month. United Airlines, American Airlines and Delta Air Lines have all climbed more than 30 percent. Oil giant Chevron is up about 38 percent. Russell 2000 – an index of small capitalization companies affected by the short-term outlook for the US economy – is up more than 20 percent this month alone.

But many analysts believe the market could have done even better without political uncertainty about the outcome of the election. The president’s baseless claim that the election was fraudulent and that he would eventually win a second term would help gain profits by injecting uncertainty into the markets.

President Hooper stated that Emily W. The decision by Murphy, the Administrator of the General Services Administration, allowed the process of the president’s transition to proceed, leaving investors confident that the election was finally held, Ms. Hooper said. “I think it was creating a significant overhang and raised questions about how long it would last,” she said.

Markets appeared to welcome the return of politics as usual under the future Biden administration, and were convinced by the news that Ms. Yellen would be Mr. Biden’s nominee to head the Treasury Department. He is a known volume on Wall Street, respected for the steady leadership of the head of the central bank from 2014 to 2018.

“There was some fear that Mr. Biden would pick up a Treasury secretary with a strong anti-Wall Street bias,” analysts with high-frequency economics wrote in a client note on Tuesday. “Janet Yellen is not that.”

Markets performed well under Mr. Trump for the most part. Since his election in 2016, the S&P 500 has returned more than 80 percent – including dividend payments. Most analysts signed the administration’s tax cuts – into law in 2017 – for a significant portion of the profits.

But the last four years have also been a volatile period for markets, with many of the sharp, sudden recessions often associated with Mr. Trump’s policies, such as his trade war with China, which saw the stock lose 6 percent in 2018 Delivered to

This year, the 11-year bull market collapsed in March, as the S&P dove about 500 percent in a matter of 500 weeks, as a worldwide virus outbreak occurred, before eventually climbing to new heights.

Mr. Trump’s style was often at odds with Wall Street’s preferences.

He broke up with Tradition of almost all other recent presidents Boeing, including Amazon, Ford and General Motors – use the power of pulpit banged up for individual companies, often re-routing their shares in real time, to decisions they dislike.

Even those on Wall Street who have endorsed some of the president’s policies often say they can do without the weight of their relentless Twitter missiles in the markets. (The president has tweeted or retweeted about 200 messages in markets since his election in 2016.)

“It always bothered me that the president tweeted about the markets,” said Paul Schatz, who manages about $ 90 million in assets for clients in New York, Connecticut and Florida. “As an investment advisor to look after people’s money, I would rather the president not be thrown into those waters.”

Michael Crowley contributed reporting.

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