US stock markets extends bullish trend as Joe Biden is in a winning position
US stock markets are rallying as election results show Democratic challenger Joe Biden has a clear edge over incumbent president Donald Trump. Former vice president Joe Biden is only a six vote away from victory while Donald Trump has secured 214 electoral votes.
US stock markets ended sharply higher on Wednesday, with the S&P 500 index ended up 2.2%, the Nasdaq jumped 3.9% and the Dow closed up 1.4%.
US stock markets are shining on Joe Biden’s lead
US stock futures have extended the upside momentum into a post-election day rally as investors believe that election uncertainty has passed. All three major indices are in green on Thursday.
Although the markets are applauding Joe Biden win, the sentiments are also high over divided representation in congress.
“It looks likely that we’ll see a split Congress, which, based on history, has been the preference of the stock market,” said Lindsey Bell, chief investment strategist at Ally Invest. “You can see this expectation being priced into the market [Wednesday] with health care, communication services and technology stocks are leading the market.”
The market analysts also believe that Joe Biden would also help in lowering the uncertainty in the global trade environment. President Donald Trump has had a bad trade relationship with several key countries including China.
Stimulus packages are among bullish factors
US stock markets are assuming that Joe Biden will introduce big stimulus packages for small businesses that are hit hardest by the coronavirus spread. Federal Reserves has also suggested the government introduce several stimulus packages to help the economic recovery and improve the employment level.
“There’s clearly some indication from voters across this country that they are focused on supporting a pro-growth, pro-business agenda,” chief policy officer Neil Bradley told reporters.
Tech stocks are among the biggest gainers as Trump has recently suggested reviewing laws related to the tech and social media sector.