[FT]Wall St rallies on election day

선거일 현재 주가는 오르고 있다.
Wall St rallies on election day
By Alistair Gray in New York
Published: November 4 2008 14:08 Last updated: November 4 2008 21:55
Wall Street stocks enjoyed their strongest election day rally since the New York Stock Exchange first opened for trading on presidential polling day.
The prospect of a clear winner helped lift the market to its highest level in three weeks as investors looked forward to strong political leadership to deal with the financial and economic crisis, ending months of uncertainty.
“The last time you had an election with this level of focus in the market was on the eve of World War Two,” said Doug Roberts, strategist at Channel Capital Research.
Most observers agreed that equities did not prefer one candidate over another, although futures markets continued to indicate the strong likelihood of a Barack Obama presidency.
Investors hoped that with the election out of the way authorities would be freer to take decisive action without partisan interference.
Stocks shrugged off glum economic news for a third consecutive session – data showed new factory orders fell more than expected – and all 10 sectors were firmly in positive territory.
The S&P 500 closed back above the psychologically significant 1,000-point level, up 4.1 per cent at 1,005.74.
The Dow Jones Industrial Average was up 3.3 per cent at 9,625.28 points while the Nasdaq Composite Index was up 3.1 per cent at 1,780.12 points, giving it six successive sessions of gains. The gains were comfortably the greatest of all presidential election days since 1984. In the years before then, markets had been closed on the day of the ballot.
The Chicago Board Options Exchange Volatility Index, Wall Street’s fear gauge, shed 11.2 per cent to 47.69 points.
Upbeat corporate earnings, further easing of strain in money markets, and the prospect of more policy measures to help prevent a global recession also gave a boost.
A diverse range of companies, such as MasterCard, Emerson Electric and Viacom reported better-than-expected quarterly figures. Shares in the three companies roose 18.3 per cent to $170.24, 10.1 per cent to $35.86 and 7.5 per cent to $22.65, respectively.
Energy led the gains, up 6.4 per cent as oil settled above $70 a barrel. Materials, industrials and financials followed closely behind.
Archer Daniels Midland leapt 15.3 per cent to $24.33 after the food processor comfortably beat forecasts that had been lowered after rival Bunge’s failure to meet expectations. The later rose 8.6 per cent to $45.31.
Elsewhere, CIT Group and General Electric jumped 36.1 per cent to $6.15 and 7.6 per cent to $20.77 respectively, on reports the Treasury might buy stakes in a wide range of financial companies, not only banks and insurers, under its $700bn rescue package.
In technology, Google and Yahoo edged up 5.9 per cent to $366.94 and 4.7 per cent to $13.35, respectively, on reports the companies scaled back their proposed web advertising deal to win over antitrust officials.
VMware shed 3.9 per cent to $30.56 on news that Intel was in the process of halving its stake in business software maker. The chipmaker gained 4 per cent to $16.26.
Dell rallied 5.6 per cent but fell back to stand 2.5 per cent higher at $12.93 after reports emerged that the computer group had instituted a hiring freeze and asked employees to consider taking up to five days of unpaid leave.
On the downside, Dean Foods dropped 17.6 per cent to $18.25 after the food group’s results fell short of expectations. The figures failed to drag down either peer Kraft Foods or the wider consumer staples sector, which were higher by 4.1 per cent at $30.51 and 2.3 per cent, respectively.
An interest rate cut in Australia sparked hopes of further policy measures around the world. Tueday’s rally, coupled with the muted trading of the previous session, comes after the wild volatility that characterised October.
“You may be asking yourself what exactly has changed in the last few days to stage this dramatic turn of events. Good question,” said Randy Frederick, director of trading and derivatives at Charles Schwab.
Analysts remained divided on whether the market would extend its rally.
Quincy Krosby, strategist at The Hartford, wrote in a note: “Given the oversold condition in the market, it is quite clear that we can build on this rally toward the year-end.”
Copyright The Financial Times Limited 2008