Stocks rose on Wednesday, extending Tuesday's gains as market sentiment turned positive and investors looked ahead to upcoming policies under the Biden administration. Each of the three major market indices rose to both intraday and closing record highs, with the Nasdaq outperforming.
President Joe Biden was inaugurated to succeed President Donald Trump as the 46th president of the United States on Wednesday. Market participants are optimistic that Biden will be able to push his new $1.9 trillion coronavirus relief package through Congress in the near-term to support economic recovery as the nation continues its massive vaccination campaign.
In his first day in office, Biden also plans to sign over a dozen executive orders, including re-engaging the nation's relationship with the World Health Organization, Rejoining the Paris Agreement on Climate Change, and launching a "100 Days Masking Challenge," aimed at encouraging Americans to wear a mask in all public settings.
Here's how the market settled on Wednesday:
S&P 500 Index (SPY ): +1.39% or +52.94 points to 3,851.85
Dow Jones Industrial Average (DIA ): +0.83% or +257.86 points to 31,188.38
Nasdaq Composite Index (QQQ ): +1.97% or +260.07 points to 13,457.25
For Stocks, Netflix (NFLX ) popped more than 16% following its fourth quarter earnings report. The streaming giant posted greater-than-expected subscriber growth during the quarter and revealed that the company is considering possible share buybacks. Alibaba (BABA ) shares also rose higher after founder Jack Ma made his first public appearance in several months, which had previously concerned investors.
For Sector Performance, almost every sector on the S&P 500 rose higher alongside Wednesday's broader market rally, with Communication Services (XLC ) leading gains at over 3% and Consumer Discretionary (XLP ), Information Technology (XLK ) and Real Estate (XLRE ) rising by about 2%. Only Financials (XLF ) fell slightly into negative territory.
For Commodities and Currency, the U.S. Dollar (UUP ) fell against most rival currencies on Wednesday as risk sentiment heightened on bets that the Biden administration would pump more stimulus in the economy. However, the dollar index, which tracks the greenback against other global currencies, rose 0.1% at 90.483. Gold (GLD ) prices extended their recent gains on Wednesday, as traders continued to use the yellow metal as a hedge against possible inflation. Spot gold rose 1.3% to $1,863.48 per ounce, while U.S. gold futures settled 1.2% higher at $1,862.90 per ounce. Crude oil futures also rose slightly on expectations that more stimulus spended with aid future demand. International benchmark Brent Crude (BNO ) rose slightly higher to settle at $56.30 per barrel, while domestic benchmark West Texas Intermediate (USO ) climbed 0.5% higher to $53.24 each.
For Thursday, traders will turn their attention to fresh weekly unemployment data as well as corporate quarterly earnings from companies like Intel (INTC ) and IBM (IBM ).