NEW YORK – Wall Street stocks jumped more than two per cent on Monday (Nov 7) as global markets rallied after the FBI cleared US presidential candidate Hillary Clinton in an email probe.
Analysts described the gains as a relief rally in the final session before the US vote on the presumption the FBI’s announcement on Sunday boosted the odds for Democrat Clinton, a clear favourite of investors over Republican Donald Trump.
“Now that uncertainty surrounding the FBI investigation has been lifted, investors believe Hillary Clinton will win tomorrow,” said Jack Ablin, chief investment officer of BMO Private Bank.
The rally on Monday ended a nine-day losing streak for the S&P 500 and Nasdaq that coincided with a tightening of election polls. Trump is viewed as a wildcard by markets because of his unpredictability and broadsides against the Federal Reserve, free trade and other targets.
The Dow Jones Industrial Average gained 371.32 points (2.08 per cent) to 18,259.60.
The broad-based S&P 500 rose 46.34 points (2.22 per cent) to 2,131.52, while the tech-rich Nasdaq Composite Index advanced 119.80 points ( 2.37 per cent) to 5,166.17.
The session also marked a reversal in the Vix volatility index, a benchmark for investor fear, which declined after nine straight gains.
J.J. Kinahan, chief market strategist at TD Ameritrade, said the extent of the rally was surprising and suggested some investors had oversold. He said there is still uncertainty about the election result despite stock gains.
“It’s hard to believe that without any results (except for early voting) the world’s suddenly a happy place and there’s no risk any more,” Kinahan said.
Gains were broad-based, with large banks Goldman Sachs and JPMorgan rising more than three per cent and large technology names including Amazon, Google parent Alphabet and Microsoft winning 2.5 per cent or more.
Drug manufacturers rallied after deep losses last week, with Merck gaining 2.1 per cent, Biogen 6.7 per cent and Mylan 4.5 per cent.
Airlines were also upward-bound with American Airlines advancing 4.2 per cent, Delta Air Lines 3.1 per cent and United Continental 2.3 per cent.