Tech leads stocks higher as investors await election results

NEW YORK — Stocks around the world are pushing higher Wednesday, but only after spinning through an election night dominated by surprises and sharp swings.

After rallying early this week amid hopes that Election Day’s arrival could clear the uncertainty that’s been weighing on markets, Treasury yields and US stock futures swung up, down and back again overnight as early results showed a race that’s still too close to call between President Donald Trump and former Vice President Joe Biden. It’s unclear when a winner can emerge.

The S&P 500 was up 1.5%, as of 9:50 a.m. Eastern time, even though nearly as many stocks within the index fell as rose. The Dow Jones Industrial Average was up 260 points, or 0,9%, at 27,740, and the Nasdaq composite was 2.3% higher.

Investors see cause for optimism if either candidate wins, but much is at stake pending the results. They include prospects for a big stimulus effort for the economy, potential tax rate increases and tighter regulations on businesses that investors saw coming from a potential Democratic sweep of the elections, something that has so far failed to materialize.

Much of Tuesday’s strength for Wall Street was due to big gains for technology stocks. Investors have increasingly seen these stocks as some of the safer bets in the market, able to grow their profits even in a pandemic as more of daily life shifts online.

They don’t need a big stimulus effort for the economy as much as other companies, leading to the much better performance for the tech-heavy Nasdaq over other indexes.

Other areas of the stock market, where profits are more dependent on the strength of the economy, weakened. Financial stocks in the S&P 500 fell 1.3% for one of the largest losses among the 11 sectors that make up the index.

Stocks of smaller companies also slumped, with the Russell 2000 index down 0.7%. Some of the market’s sharpest moves overnight were in yields for US government bonds, which had earlier risen on expectations that a Democratic electoral sweep could open the door for big economic stimulus.

The 10-year Treasury yield swung from 0.88% late Tuesday up to 0.94% as polls were closing. It then sank as odds for a Democratic takeover of the Senate diminished and after Trump made premature claims of victories in several key states. It sat at 0.76% shortly after trading opened on Wall Street.

Agencies via Xinhua