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U.S. stocks closed at record highs on Wednesday when Joe Biden was sworn in as the 46th president – with the new Commander-in-Chief setting a record stock market gains between his election and his inauguration.
The benchmark S&P 500 rallied to finish 14% higher on inauguration day than it was on election day, breaking a record set by President Hoover in 1928 when the S&P rose by 13.3% over 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 inauguration day policy did much, but certainly the wait for a trillion more raise,” said Ross Mayfield, investment strategy analyst at Baird, in Milwaukee, Wisconsin.
The Dow Jones has gained around 57% and the S&P 500 has gained around 68% since Donald Trump took office on January 20, 2017, which compares to a 65% jump in the Dow Jones and 75% at S&P during the Obama administration’s first term.
Major Wall Street indexes have hit record highs in recent months, with the blue chip Dow having jumped about 13% since the November presidential election, with investors betting on a strong economic recovery in 2021 thanks to the deployment of the COVID-19 vaccine and a larger pandemic contingency plan.
Shares of the world’s largest streaming service, Netflix, surged on Wednesday after it said it would no longer need to borrow billions of dollars to fund its TV shows and movies.
The rest of the FAANG group all surged with expected results in the coming weeks. The NYSE FANG + TM index also rose.
“It’s a day of tech outperformance that’s pretty rare over the past two or three months because the cyclical rotation has kind of kicked in,” Mayfield said.
Almost all of the S&P’s top 11 sectors advanced in the afternoon trading, with communications services, consumer discretionary and technology among the biggest gainers.
In conclusion to the results of major US lenders, Morgan Stanley slipped despite posting quarterly earnings that exceeded past estimates due to the strength of its trading activity.
With stock valuations nearing a 20-year high, investors are hoping that company results and profit outlook will help them determine how justified the valuations are.
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 3851.85 and the Nasdaq Composite added 260.07 points, or 1.97%, to 13,457.25.
With Reuters
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