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Overnight Markets: US stocks rally on US elections results

Overnight Markets: US stocks rally on US elections results

Wall Street closed sharply higher on Wednesday, led by the technology and healthcare sectors, following watched midterm elections that saw Democrats take control of the House.

The Dow Jones Industrial Average jumped 545 points, or 2.13%, to 26,180, the S&P 500 surged 58 points, or 2.12%, to 2,814, and the Nasdaq Composite gained 195 points, or 2.64%, to 7,571.

Democrats secured control of the House of Representatives on Tuesday, while President Donald Trump’s Republican party expanded its Senate majority, pointing to the likelihood of political gridlock in Washington.

Technology sector and the healthcare stocks rose 2.9% giving the S&P 500 the biggest boosts. The consumer discretionary sector surged 3.1%, spurred by a 6.9% rise in Amazon.com shares. Amazon provided the single biggest boost to the S&P 500.

Health insurers Humana Inc, Anthem Inc and UnitedHealth Group Inc jumped to record highs as voters in three states approved expanding Medicaid programmes for low-income people.

DaVita Inc jumped 10.9% after California rejected a proposal to limit the rates that dialysis clinics can charge commercially insured patients.

Anadarko Petroleum Corp added 5.7% and Noble Energy Inc gained 4% after Colorado voters rejected a tougher rule on oil and gas drilling.

On the negative side, shares of Michael Kors Holdings Ltd. tumbled 14.6%, after the fashion luxury group missed revenue expectations.

Coty Inc. fell 22.5% after the beauty-products company said it lost money in the first quarter of fiscal 2019 due to supply disruptions.

Meanwhile, the Federal Reserve began a two-day monetary policy meeting on Wednesday, but no rate increase was expected.

In Asia, shares traded higher on Thursday in the morning session after the Dow Jones and S&P 500 recorded their best post-midterm elections rally since 1982.

Japan's Nikkei 225 jumped 1.89% in early trade. South Korea's Kospi also advanced 1.43%. In Australia, the ASX 200 was 0.47% higher. In China, the Shanghai Composite Index added 0.33%, while Hong Kong’s Hang Seng Index gained 0.76%.

 

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