By Yashaswini Swamynathan
Wall Street rallied on Monday, the eve of the U.S. presidential election, as Democrat nominee Hillary Clinton's prospects brightened after the FBI said it would not press criminal charges related to her use of a private email server.The gains were broad based, with all 30 Dow components and all 11 major S&P 500 sectors rising. U.S. stocks were set for their biggest one-day percentage gain since March 1, while a volatility measure was set for its biggest drop since late June.IShares MSCI Mexico ETF (EWW.P), known of late as the "Trump ETF", soared 5.6 percent and was on track for its best day in more than five years. The ETF is viewed as a barometer for Republican Donald Trump's chances of winning the election since his policies are considered negative for Mexico.Wall Street closed lower for nine days in a row through Friday, their longest losing streak in more than 35 years and one that gained momentum after the FBI said on Oct. 28 that it was reviewing some newly found Clinton emails.The FBI said on Sunday that it stood by its July finding that Clinton was not guilty of criminal wrongdoing.While, polls last week showed Trump had been closing the gap, at least five major polls on Monday showed Clinton still had the lead in the race for the White House."Clinton is a known quantity and investors hate uncertainty and they are very happy even if taxes were to go up ... In the case of Trump, it is uncertain as to what he stands for," said Komal Sri-Kumar, president of Sri-Kumar Global Strategies.
Investors have tended to see Clinton as a more status quo candidate. On the other hand, Trump's stance on foreign policy, trade and immigration has unnerved the market."The markets have been comforted as it appears that either a Trump victory or a Democratic landslide are not coming to pass," said Eric Wiegand, senior portfolio manager at the Private Client Reserve at U.S. Bank.At 13:24 a.m. ET (1724 GMT), the Dow Jones Industrial Average .DJI was up 342.08 points, or 1.91 percent, at 18,230.36.The S&P 500 .SPX was up 41.99 points, or 2.01 percent, at 2,127.17 and the Nasdaq Composite .IXIC was up 114.33 points, or 2.27 percent, at 5,160.70.
The CBOE Volatility index .VIX, dubbed Wall Street's "fear gauge", was down 16.5 percent, on pace for its biggest one-day fall since June 28, a few days after Britain voted to leave the European Union.The financials' .SPSY 2.4 percent rise led the gainers among the 11 S&P sectors. Investors expect a Clinton victory to not hinder a potential U.S. interest rate hike next month.The defensive telecom services .SPLRCL and utilities .SPLRCU were the only sectors notching gains below 1 percent.
Risk assets were back in favour. Brent crude futures rose for the first time in seven days. Even the dollar's .DXY first rise in five days did little to hamper the gain .Safe-haven gold was set for its worst day in more than one month. Gold miner Newmont's (NEM.N) 4.4 percent-drop was the biggest on the S&P.Biogen (BIIB.O) rose 6.7 percent to $295.65 after the drugmaker and Ionis (IONS.O) announced positive interim trial data. Ionis shares soared 18.54 percent to $32.16.Advancing issues outnumbered decliners on the NYSE by 2,539 to 393. On the Nasdaq, 2,302 issues rose and 475 fell.The S&P 500 index showed 12 new 52-week highs and no new lows, while the Nasdaq recorded 59 new highs and 55 new lows. (Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Savio D'Souza)
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Published Date: Nov 08, 2016 12:15 am | Updated Date: Nov 08, 2016 12:15 am