Stocks Jump the Morning After the Midterms: Dow Up More Than 1,200 Points, Nasdaq Up 2.1 Percent, as Analysts Point to Divided Government
The New York Post, citing Reuters and the AP, says analysts expect a gridlocked Washington to limit policy swings. Oil slipped, and tech was the weak spot overseas, with Japan's Nikkei down as much as 4.8 percent.
U.S. stocks rose sharply Wednesday after Democrats won both chambers of Congress, the New York Post reports.
The moves. At the time of the Post's report, the Dow Jones Industrial Average was up more than 1,200 points, the S&P 500 was up 1.7% and the Nasdaq Composite was up 2.1%. Our earlier report covered the sell-off in stock futures as results came in Tuesday night. Per the Post, Nasdaq futures fell as much as 2.4% overnight and rebounded about 1% by morning.
Why analysts say markets like it. The Post says markets tend to prefer divided government because it limits sweeping policy changes. It quotes Michael Krautzberger of Allianz Global Investors, via Reuters: "Investors could conclude that Washington remains structurally constrained, limiting the prospects for dramatic shifts in the economic outlook." Stephen Brown of Capital Economics told the AP the size of the Democratic gains "does not change too much for the near-term policy outlook," because the party still lacks a filibuster-proof Senate majority and Trump has veto power.
Oil. The Post says oil fell on hopes that Trump might rein in his foreign policy decisions after the election. Brent crude was down 0.7% to $102.87 a barrel and WTI was down 0.2% to $94.97.
Tech and data centers. The Post says data center concerns were a big topic in states such as Texas and Georgia, and that political pressure has made investors nervous, per Reuters sources. Nabil Milali of Edmond de Rothschild Asset Management said uncertainty is likely to last in the short term while tech giants negotiate with new local authorities. Overseas, the Post says, Japan's Nikkei 225 fell as much as 4.8% and Taiwan Semiconductor shares dropped 1.5%, citing the New York Times.
What we could not check. These are intraday figures from the Post's 10:12 a.m. Eastern report and will have changed by the close. The headline cites 1,200 points while the web address says 930, which suggests the story was updated. We have not seen the Reuters, AP or Times reports it quotes.