While you were sleeping: Dow hits record high
Nov. 11 (BusinessDesk) - Wall Street advanced, with the Dow climbing to a record high, while US Treasuries slid, amid bets that US President-elect Donald Trump will spend more and regulate less.
“People are going through the possibilities about what Washington looks like today and what Washington can do or not do for them,” John Manley, chief equity strategist for Wells Fargo Funds Management in New York, told Bloomberg. “Corporations feel there’s a less restrictive hand. People may take that as a positive.”
In 1.14pm trading in New York, the Dow Jones Industrial Average rose 1.1 percent. Earlier in the session it touched a record high 18,810.58. In 12.59pm trading, the Standard & Poor’s 500 Index added 0.3 percent.
The Dow rose, led by advances in shares of Pfizer and those of JPMorgan Chase, up 4.7 percent and 3.9 percent respectively. Bucking the trend, shares of Procter & Gamble and those of Coca-Cola declined, down 3.4 percent and 2.9 percent respectively.
The Nasdaq Composite Index fell 0.6 percent, as shares of Amazon and Apple declined, down 3.5 percent and 2.3 percent respectively.
“Tech stocks aren't really in the handbook," Art Hogan, chief market strategist at Wunderlich Securities in New York, told Reuters. “They aren't really going to benefit from Trump's stimulus spending on infrastructure and are sort of sitting in the middle.”
“They aren't part of the oversold sectors such as banks and health nor are they high dividend paying stocks that [are] getting sold off,” Hogan noted.
Also, some investors are concerned tech stocks might suffer from Trump’s protectionist stance.
The US dollar rose while Treasuries fell amid bets a Trump presidency will bolster inflation, while the Federal Reserve will raise interest rates.
Yields on the benchmark 10-year note rose four basis points to 2.10 percent, while yields on the 30-year bond climbed increased five basis points to 2.90 percent, according to Bloomberg.
“The [US] dollar will do very well” on a broad trade-weighted basis in the next 12 months, Bilal Hafeez, global head of foreign-exchange research at Nomura Holdings in London, told Bloomberg. “The Fed will be increasing interest rates, the US will be engaging in fiscal stimulus of some kind, which is much-needed by economies around the world, so we’ll have faster growth and more inflationary pressures.”
In Europe, the Stoxx 600 Index ended the day with a 0.3 percent decline from the previous close. Germany’s DAX Index fell 0.2 percent, France’s CAC 40 Index declined 0.3 percent, while the UK’s FTSE 100 Index shed 1.2 percent.