Wall Street Rallies On Prospect Of Divided U.S. Congress
Wall Street’s main indexes jumped on Thursday as investors bet on a Republican-held Senate that would block any moves by a Joe Biden administration to tighten regulation and raise taxes on corporate America, even as the presidential election remained too close to call.
The tech-heavy Nasdaq gained 2.7% and was within striking distance of it Sept. 2 record closing high.
The Philadelphia SE semiconductor index surged 4.1% to hit its own all-time high, while technology and communication services led gainers among S&P indexes.
The materials index also hit a record high, boosted by a 7.6% rise in shares of U.S.-German industrial gas producer Linde after it raised its expectations for full-year earnings.
With President Donald Trump and his Democrat rival Biden still awaiting clarity from the battleground states expected to decide the election, investors were returning to the core setting of the past decade: buying stocks with the flood of extra monetary stimulus coursing through the financial system.
Biden edged closer to victory in the race for the White House on Thursday after winning Michigan and Wisconsin, but Democrats appeared unlikely to win the Senate, potentially making it difficult for a Democrat administration to rein in Big Tech and other businesses.
“Markets prefer divided government,” said Brian Levitt, Invesco global market strategist.
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