Updated at 4:20 p.m. EST
U.S. stocks ended the election-day trading session higher as investors weighed the potential outcome of mid-term voting in the U.S.
The Dow Jones Industrial Average rose 335.28, or 1.02% to 33,162.28. The S&P 500 rose 21.31, or 0.56% to 3,828.11. Winners outpaced losers 352 to 143 in the S&P 500. Within the S&P 500, materials stocks led, while energy lagged.
The Nasdaq Composite rose 51.68, or 0.49% to 10,616.20.
Updated at 10:17 am EST
U.S. stocks extended gains Tuesday, while the dollar held firm against its global peers, as investors kept risk appetite in check ahead of crucial mid-term elections that could set the tone for market performance over the coming year.
All 435 House seats, 220 of which are currently held by Democrat lawmakers, are up for grabs Tuesday, with 35 Senate races, 21 of which are Republican, also being contested. A collection of non-partisan polls suggest Republican candidates win a majority in the House, and pick up as many as three seats in the Senate following Tuesday's vote.
The likelihood of a Republican sweep, and a divided government over the second half of President Joe Biden's term in office, helped stocks book solid gains Monday as investors looked to historical data suggesting that the S&P 500 has outperformed over the six months following mid-term votes, compared to its prior six month record, in seventeen of the nineteen mid-term elections since 1946.
"There are few immediate ramifications if Republicans take both houses, as US President Biden has the presidential veto, but a stronger than expected Democratic showing that somehow sees them retaining the House and strengthening their Senate majority would be a game changer – opening for more policy dynamism (and inflation from fiscal stimulus) from the US over the next two years rather than the expected lame-duck presidency," said Saxo Bank strategies. "The latter is a very unlikely scenario, but uncertainty is high as pollsters have had a hard time gathering accurate polls, especially for specific states, for every election since Trump’s victory in 2016."
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Developments in China overnight, however, as well as the chances of a Democratic upset later today, are keeping early gains in check. Health officials in Beijing reported a 36% increase in Covid infections, which now total around 7,500, spread across a growing number of cities in the world's biggest economy.
The increase suggests the country's 'zero Covid' policies are likely to remain in place for the foreseeable future, brining lockdowns, plant closures and further supply chain disruptions alongside.
Benchmark Treasury bond yields were on the move, rising in overnight dealing to 4.224% ahead of a $40 billion auction on Wednesday, before retreating to 4.151% during New York hours. The U.S. dollar index was marked 0.04% higher against a basket of its global peers at 110.152.
Heading into the opening hour of the trading day on Wall Street, the S&P 500 was marked 14.2 points higher while the Dow Jones Industrial Average gained 250 points. The tech focused Nasdaq was 25 points higher.
Lyft (LYFT) - Get Free Report shares were a notable mover, ending off 23% after the smaller ride-sharing rival to Uber Technologies (UBER) - Get Free Report posted a surprise third quarter loss and a disappointing holiday season forecast.
Nvidia (NVDA) - Get Free Report rose 2.1% following a report suggesting the chipmaker had developed a new semiconductor it could sell to customers in China without violating new U.S. export restrictions.
Activision Blizzard (ATVI) - Get Free Report shares edged 1.3% higher after the video game maker posted stronger-than-expected third quarter earnings late Monday and said its planned $69 billion takeover by Microsoft (MSFT) - Get Free Report is expected to be completed by the middle of next year.
Take-Two Interactive (TTWO) - Get Free Report, however, slumped 14% after the Grand Theft Auto and NBA 2K23 maker posted weaker-than-expected second quarter earnings and issued a downbeat holiday season forecast.
In overseas markets, China stocks gave back early gains on the back of the accelerating Covid infections, pulling the region-wide MSCI ex-Jan index lower, but still in the green with a 0.42% gain.
In Europe, the Stoxx 600 gained 0.43% by mid-day trading in Frankfurt as it closely-tracked U.S. equity markets while Britain's FTSE 100 was marked 0.07% lower in the opening hours of trading in London as the pound advanced to 1.1527 against the dollar.