NEW YORK – Wall Street stocks posted solid gains on Tuesday (Nov 8), extending a rally fuelled by market expectation Democrat Hillary Clinton will win a tightly-contested US presidential race.
While votes have yet to be counted, analysts said investors believe election polls that show Clinton with a modest, but clear, edge over Republican candidate Donald Trump.
The Dow Jones Industrial Average advanced 72,83 points (0.40 per cent) to 18,332.43. The broad-based S&P 500 rose 8.01 points (0.38 per cent) to 2,139.53, while the tech-rich Nasdaq Composite Index increased 27.32 points (0.53 per cent) to 5,193.49.
“If all things remain the same, the consensus is we may have a Democratic administration and a Republican House,” said Art Hogan, chief market strategist at Wunderlich Securities.
“So it’s probably status quo and the market’s fine with that. Anything outside of that result will probably cause a lot of turmoil in the market.”
US stocks opened lower, but shifted into positive territory later in the morning, adding to Monday’s advance, when US stocks snapped a nine-day losing streak by surging two per cent.
Monday’s advance was sparked by an announcement by the FBI clearing Clinton in a probe of her email server. Markets have shown a clear preference for Clinton, given Trump’s promises to shake up US economic policy and his controversial foreign policy statements.
There were other signs of increased confidence in a Clinton win: the Mexican peso gained ground against the dollar, and the Vix volatility index, a measure of market fear, fell.
Several food stocks rallied following reports that 3G Capital, a Brazilian investment fund, was exploring a new acquisition in the industry. Mondelez International gained 4.1 per cent, General Mills 3.0 per cent, Campbell Soup Company 3.3 per cent and Kellogg 2.7 per cent.
CVS Health slumped 11.8 per cent after the chain trimmed its profit forecast, citing slowing growth in prescription drugs, as well as seasonal sluggishness and the loss of some 40 million prescriptions due to the loss of its contract under a Pentagon programme. Rival Walgreens Boots Alliance lost 1.7 per cent.
Valeant Pharmaceuticals International sank 21.7 per cent as it reported a US$1.2 billion loss in the third quarter after writing down the value of some assets by more than US$1 billion.
Priceline surged 6.6 per cent as it reported third quarter revenues of US$3.7 billion, up nearly 19 per cent from the year-ago period. Chief executive Jeffery Boyd described market conditions as “favourable.”
Car rental giant Hertz plunged 22.5 per cent as it reported a 35.8 per cent decline in third quarter net income to US$134 million as rental volumes disappointed and fell short of its cost-cutting targets. Rival Avis Budget Group plummeted 9.5 per cent.