Wall Street Posts Election-Day Rally, Dow Jumps 133

JOLLY SEA OF GREEN
Wall Street zoomed higher Tuesday in a broad-based advance as Americans headed to the polls to elect the next president. Trading desks across the world were fixated on the American presidential election, the results of which are likely to play a big role in shaping the world's leading economy in years to come. Last-minute polling showed President Barack Obama and Mitt Romney locked in a very tight race. 
 

A significant concern among market participants was also the uncertainty that could be caused by the election dragging out over several days or weeks.

The Dow blazed a trail higher right out of the gate today, topping out at 13,290.75 around midday before closing with a triple digits gain of 133.24 points or +1.02% at 13245.68.  The bullish momentum waned just slightly in the final hour of trading, though, with the blue-chip barometer paring its lead. Today marks just the second close north of 13,200 since Oct. 22 for the Dow.

ANALYSTS' QUOTES:

"Although volume has been relatively light, we enjoyed a pretty nice Election Day rally." 

 "This reminds me of four years ago, when we also had a strong, positive move on Election Day. Overall, we're seeing a lot of strength from crude oil, gold, and other commodities, especially as the dollar displayed quite a bit of weakness."

“Hope springs eternal on Wall Street that we won’t fall apart. There is enough of a belief that the economy is going to expand, maybe not strongly, but still expand, in 2013.”

“For the past few months we’ve been saying that the market would rally in November and December, regardless of who wins. It looks like the economy is improving and the Federal Reserve is still pumping money into the system."

GOODLUCK OBAMA

WALL STREET 15 Sept 2012 >>> U.S. stocks extend Fed-inspired rally

DJIA ends at multi-year high on Feds stimulus promise
U.S. stocks rose for a fourth straight session on Friday to close out the week at nearly five-year highs after the Federal Reserve took bold action to spur the economy, a move that could keep equities buoyed in the coming months. Equities are in a run-up that also pushed the S&P 500 to end higher for four consecutive months. The extended advance has come mainly from actions by Europe's and the United States' central banks to keep interest rates low and stimulate their struggling economies.

The Fed said Thursday that it would keep up its aggressive bond-buying until unemployment falls. Chairman Ben Bernanke said he wanted to see a convincing improvement in the economy that could deliver sustainable job creation.

Scaling back from a 113-point climb, the Dow Jones Industrial Average DJIA +0.40%  gained 53.51 points, or 0.4%, to 13,593.37, the highest close since Dec. 10, 2007. It gained 2.2% on the week, tallying gains for eight of the past 10 weeks. The sharp turn higher for equities came after the Fed unveiled an open-ended plan to buy mortgage-backed assets at a clip of $40 billion a month. The central bank also pledged to take more actions, if necessary, to give the stodgy economy and labor market a fresh jolt of power.

It was the best week for the Dow since early June. The broader markets had a strong week as well: the S&P 500 jumped 1.9% and the Nasdaq rallied 1.5%. 

ANALYSTS QUOTES

"Today is simply a continuation of the strength we saw yesterday." 

"Bernanke's comments are going to create an artificial floor on the market, meaning that we could see higher prices over time. Any correction that we get will be no more than a few percentage points."

"Right now we have this short-term euphoria. But then the question is where do we go from here? I think after a week or so, if the underlying economic data doesn't change, you're going to see the market drop a bit and we'll continue to plod along until the election."

“We had a fair amount of data out right on the heels of the Fed, but probably the biggest influence today is still the after-effects of the Fed’s announcement yesterday.”

"We are starting to get into that heady territory where you need to be on the defensive. Trying to squeak out the last 5 percent of a move when there is potentially a 15 to 20 percent downside in my opinion is pretty dangerous stuff."

"While everyone is trying to figure out what QE3 means to the economy, stocks have spoken, and they like it. At the same time, hedge funds have totally dropped the ball and missed most of this rally. There's a good chance these Johnny-come-latelies could be the fuel for the next surge higher."

 

 HAPPY TRADING

WALL STREET 31st Aug 2012 >>> Stocks higher, but volatile, after Bernanke's speech

DJIA gyrates as Bernanke speaks finally settling at 3 months high

It took a while, but investors eventually decided they liked what they heard from Ben Bernanke, and stock indexes rose enough on Friday to put them into positive territory for August.

Stocks gyrated after the Federal Reserve chairman spoke on Friday morning. They first gave up their morning gains, then bolted to their highs for the day, before settled in-between.

The Dow Jones industrial average ended the day up 90.13 points at 13,090.84.

A half-hour after trading began, Bernanke declared that the Fed is ready to take more action to help an economy that’s “far from satisfactory.”

Investors have been watching to see whether the Fed will buy more bonds to further lower long-term interest rates. Stocks fell initially, however, after it became clear that no such announcement was coming Friday and that Bernanke had stopped short of committing the Fed to any specific move.

Still, he said the Fed “should not rule out” new policies to improve the job market.

Stocks rebounded once investors parsed his comments. At one point the Dow was up as many as 151 points.

In terms of volatility, “it’s been the most action we’ve seen in couple of weeks,” said a senior equity trader. He noted that pre-Labor Day volume was light, with many investors and traders on vacation, which can contribute to bigger price swings.

The Standard & Poor’s 500 index closed up by 7.10 points at 1,406.58. The Nasdaq rose 18.25 points to close at 3,066.96.

The Dow finished the month of August up by 0.8 percent. The S&P 500 rose more than 2 percent for the month, and the Nasdaq rose more than 4 percent.

ANALYSTS QUOTES

"The market drew a lift today on further confirmation that [Fed Chairman Ben] Bernanke does have another round of QE in his back pocket.”

“It certainly seems he’s making an impassioned case for the ethicality of further monetary easing. If he believes it, and the board believes it, and they continue to see the dire need for it, we’re probably going to get something."

"There was no announcement about if more stimulus was coming immediately, but he (Bernanke) said the Fed was ready to act if necessary so that was supportive."

“The true test of the market advance will come when more investors come back in September. Volume has been anemic."

“Stocks have mostly priced in odds of QE3 taking place along with substantial policy actions out of the Europeans, with what’s going on with gold and silver being up today on weakness in the dollar that’s clearly associated with Bernanke’s coming likely actions,” 

"Along with the factory orders and consumer sentiment data, the (market) longs are in control."

HAPPY TRADING