By Chuck Mikolajczak
NEW YORK (Reuters) – The index briefly breached the 6,000 mark and closed with the biggest weekly percentage gain in a year, after Donald Trump’s election victory and a possible Republican Party victory in Congress dampened expectations for favorable business policies fed.
Also supporting stocks this week was Thursday’s widely expected 25 basis point interest rate cut by the Federal Reserve.
The S&P 500 and the Dow Industrials recorded their best weekly percentage gains since early November 2023, while the Nasdaq posted its best week in two months and the second-best week of 2024.
Investors also factored in a likely ‘Red Sweep’ as Republicans would maintain their slim lead in the House of Representatives after winning control of the Senate. That would make it easier for Trump to implement his legislative plans.
Expectations for lower corporate taxes and deregulation pushed the Nasdaq to record highs for three straight sessions. The S&P achieved its 50th record at the end of the year.
“It’s a psychologically important number, but with all the developments this week I don’t think it’s very important whether we close at 6,005 or whether we close at 5,995. The market has been up a lot this week,” said Mike Dickson, head of research and quantitative strategies at Horizon Investments in Charlotte, North Carolina.
“There’s been so many things this week and so much good news for the market, as reflected in the prices. That all far outweighs whether or not we’re on the right or left side of that 6,000 number as the closure takes place.”
The S&P 500 rose 259.65 points, or 0.59%, to 43,988.99, the S&P 500 gained 22.44 points, or 0.38%, to 5,995.54 and gained 17.32 points, or 0. 09%, to 19,286.78.
This week, the S&P 500 rose 4.66%, the Nasdaq rose 5.74% and the Dow Jones rose 4.61%.
The Dow Jones rose above 44,000 for the first time, partly due to a late boost from Salesforce (NYSE:), which rose 3.59% after Bloomberg reported that the software company will hire 1,000 employees to build its artificial intelligence Agentforce Tool promote.
The S&P 500 and Nasdaq posted their fourth straight winning session.
Rate-sensitive sectors such as real estate and utilities performed the best among the 11 major S&P 500 groups, while Treasury yields fell for the second time in a row after a sharp post-election jump.
But the benchmark remained near four-month highs, and markets have scaled back expectations for the pace of Fed rate cuts through 2025 as concerns remain about the new administration’s proposed rates, which are likely to fuel inflation again.
The small cap also advanced, rising 8.51% this week, posting its biggest weekly percentage gain since April 2020, as domestically concentrated stocks are seen as likely to benefit from simpler regulations, lower taxes and less exposure to import tariffs.
US consumer confidence rose to a seven-month high in early November, with a measure of households’ future expectations rising to the highest level in more than three years, led by a more positive outlook among Republicans, the Consumer Sentiment Index showed. University of Michigan.
Shares of Airbnb fell 8.66% after the homestay missed third-quarter earnings estimates, while social media company Pinterest (NYSE:) plunged 14% after disappointing revenue forecasts.
US listings of Chinese companies lost ground as the latest government fiscal stimulus measures once again failed to impress investors. JD (NASDAQ:).com fell 6.99% and Alibaba.com (NYSE:) lost 5.94%.
Advancing issues outpaced declining issues by a 1.7-to-1 ratio on the NYSE and by a 1.21-to-1 ratio on the Nasdaq.
The S&P 500 posted 88 new highs and 10 new lows over the past 52 weeks, while the Nasdaq Composite posted 211 new highs and 108 new lows.
Volume on U.S. exchanges was 15.46 billion shares, compared to the full-session average of 12.74 billion over the past 20 trading days.
