A green, not red, wave swept over the U.S. stock market on Monday as investors placed bets that not only would former President Donald Trump win the White House in November, but he’d carry Congress with him, analysts said.
The Dow Jones Industrial Average closed at a record high 40,211.72 while the broad Standard & Poor’s 500 index touched the all-time high of 5,666.94 during the session after Trump survived an assassination attempt at a rally over the weekend. The failed assassination gives Trump strong momentum going into the Republican National Convention (RNC) on Monday in Milwaukee, Wisconsin, and that’s spilling over into hopes Republicans can win Congress, analysts said.
A Republican sweep of the White House and both chambers of Congress would potentially give Republicans an easier time of passing “business friendly” legislation, they said. If businesses do well, their stock prices usually rise.
“Before the weekend, markets already thought it was likely (former) President Trump president would win, but the overall ‘red wave’ scenario wasn’t my base case,” said independent stock market analyst Ed Moya. “There’s strong momentum here now for that.”
What a red wave could mean for businesses (and stocks)?
- Less regulation. “We are seeing a glimpse of how market players want to express a Trump Presidency – and clearly, that outcome is positive for U.S. equity, notably with promises of deregulating industry, which would be a strong positive kicker,”…
