by Chuck Mikolajczak
NEW YORK (Reuters) – The New York Stock Exchange soared to closing records on Wednesday to welcome Donald Trump’s resounding victory in the US presidential election, promising investors a favorable environment for businesses with declines taxes and deregulation.
Donald Trump’s economic commitments, likely to fuel inflation and widen deficits, also pushed up yields on US Treasury bonds and the dollar, while bitcoin crossed the $75,000 mark for the first time, the president-elect having declared himself in favor of cryptoassets.
Wall Street’s three major indexes finished at closing records, with the Dow and S&P-500 recording their biggest single-session percentage gains since November 2022.
The Dow Jones index gained 3.57%, or 1,508.05 points, to 43,729.93 points.
The broader S&P-500 gained 146.28 points, or 2.53%, to 5,929.04 points.
The Nasdaq Composite advanced 544.29 points (2.95%) to 18,983.465 points.
The Russell 2000 index of small caps, likely to also benefit from an increase in customs duties promised by Donald Trump, for its part jumped 5.84% to a three-year high.
The former president’s larger-than-expected victory over Democrat Kamala Harris also dispels fears of prolonged uncertainty in the event of a close or even contested election. The VIX index, which measures market volatility, ended at a six-week low of 16.27.
The financial sector (+6.16%) was the most prominent of the 11 major sectoral indices of the S&P thanks in particular to the banks, whose specific index soared by 10.68% while they should benefit fully from of deregulation.
Conversely, the sectors most sensitive to changes in interest rates, real estate (-2.64%) and community services (-0.98%), were among the rare losers of the day.
The Federal Reserve has just launched a sequence of monetary easing and is expected to further lower its rates by a quarter of a point on Thursday, but the prospect of a resumption of inflation with Donald Trump could lead it to review its trajectory for the following.
In terms of individual values, one of the main beneficiaries of Donald Trump’s success was Tesla (+14.75%), whose boss and founder Elon Musk was personally and financially involved in the campaign of the Republican candidate, who could appointed to head a commission responsible for evaluating the effectiveness of the federal state.
( Bertrand Boucey)
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