Stock futures jumped in volatile trading Tuesday night as results of the presidential election rolled in. Futures for the Nasdaq-100 index, home to many tech stocks, jumped the most.
Nasdaq 100 futures popped 2.6% and S&P 500 futures gained 1%. Dow Jones Industrial Average advanced 89 points, or 0.3%.
Other markets were making significant moves:
- Bonds were higher, with the yield on the 10-year Treasury note falling to 0.82%. Bonds were lower earlier in the evening with the yield hitting a high of 0.945%. (Yields move inversely to prices.)
- Futures for the small-cap benchmark Russell 2000 rose 0.7%.
- The U.S. dollar index gained 0.3% after falling earlier. The greenback also hit its highest level since Oct. 2 against the Chinese yuan.
- U.S. oil futures gained 2.2%.
Futures gyrated as polls closed and states began to be called. They then gained, led by Nasdaq futures, as the evening went on.
“It’s still early and stock futures are likely to stay volatile throughout the night, but right now the market feels ready to price a better outcome than anticipated – that a runaway wide margin Biden win is off the table,” said David Bahnsen, chief investment officer of The Bahnsen Group.
So far, President Donald Trump will win the presidential vote in Indiana and Kentucky along with South Dakota and Arkansas, NBC News projects. Trump is also projected to win Alabama and North Dakota. Former Vice President Joe Biden is projected to win Vermont, Delaware, Maryland and Massachusetts as well as Colorado and New York, according to NBC News.
Florida was too close to call and Pennsylvania was too early to call along with North Carolina and Ohio, NBC News said.
“We’re seeing in one night what we’ve seen over the past two weeks, which is a tug of war within the polling itself causing wide swings in the market as uncertainty persists,” said Keith Lerner, chief market strategist at Truist/SunTrust Advisory.
Treasury Secretary Steven Mnuchin told CNBC’s Kayla Tausche a couple hundred attendees were watching the election results come in at the East Room, calling the mood “great.”
During Tuesday’s regular trading, the Dow popped more than 500 points, or 2.1%. The S&P 500 gained 1.8%, and the Nasdaq Composite advanced 1.9%. Those gains added to Monday’s strong performance.
This week’s market moves come as investors hoped a delayed, or contested, U.S. presidential election result would be avoided and a clear winner would emerge Tuesday night.
“This most recent uptick in prices seems to be a ‘clarity rally’ as investors look forward to finally having the election uncertainty overhang removed,” Adam Crisafulli, founder of Vital Knowledge, wrote in a note Tuesday.
Biden was ahead of Trump in the polls leading up to Tuesday. Wall Street is also watching some key Senate races.
The S&P 500 lost 0.4%, on average, the day after presidential elections, according to Baird.
Chao Ma of the Wells Fargo Investment Institute thinks investors with a longer time horizon should not worry too much about the election’s impact on the broader market.
“The history of the economy and the S&P 500 Index suggests that a president’s party affiliation has made little difference when it comes to long-term returns,” said the firm’s global portfolio and investment strategist. “The long-term drivers of the S&P 500 index have been the economy and business earnings, and we expect that to continue to be the case … beyond the 2020 elections.”
One year out from a presidential election, the S&P 500 averaged a return of more than 8%, according to the Baird data back to 1960.
—CNBC’s Pippa Stevens contributed to this report.
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