U.S. stocks closed the record high on Wednesday when Joe Biden vowed to be the 46th president, with the new commander-in-chief setting a record earnings of shares between his election and his inauguration.
The S&P 500 benchmark met to finish 14% higher on the day of the inauguration than on election day, beating the record set by President Hoover in 1928, when the S&P rallied 13.3% during the same interval, according to MarketWatch.
Biden will waste little time turning the page on the Trump era, aides said, signing 15 executive actions in the afternoon on issues ranging from the COVID-19 pandemic to the economy to climate change.
“I’m not sure the opening day policy did much, but certainly the expectation of a trillion plus stimulus,” Ross Mayfield, an investment strategy analyst at Baird, said in Milwaukee, Wisconsin.
The Dow has gained about 57% and the S&P 500 has advanced about 68% since Donald Trump took office on January 20, 2017, which compares to a 65% jump in the Dow and a 75% increase in the S&P during the first term of the Obama Administration.
Wall Street’s major indices climbed record highs in recent months, with the Dow jumping around 13% since the November presidential election, as investors pledged a strong economic recovery in 2021 thanks to the implementation of the COVID-19 vaccine and a plan to alleviate the larger pandemic.
Shares of the world’s largest streaming service Netflix rose on Wednesday after it said it would no longer have to borrow billions of dollars to fund its TV and movie shows.
The rest of the FAANG group jumped with the results obtained in the coming weeks. The NYSE FANG + TM index also rose.
“It’s a day of technological overtaking, which is quite rare in the last two or three months, as the cyclical rotation has begun,” Mayfield said.
Nearly all 11 major S&P sectors advanced in the afternoon trade, with communication services, consumer discretion and technology among the biggest winners.
Summarizing the results of major U.S. lenders, Morgan Stanley fell despite making quarterly profits that exploited previous estimates driven by the strength of its commercial business.
With stock market valuations close to a 20-year high, investors expect corporate results and earnings prospects to help them determine the extent to which valuations are justified.
Unofficially, the Dow Jones Industrial Average rose 257.86 points, or 0.83%, to 31,188.38, the S&P 500 gained 52.94 points, or 1.39%, to 3,851.85, and the Nasdaq Composite added 260.07 points, or 1.97%, to 13,457.25.
With Reuters