Dow Hits Historic 30,000 as Bulls Ride Value Stocks Higher
Investing.com
Published Nov 24, 2020 01:38PM ET
Updated Nov 24, 2020 02:47PM ET
By Yasin Ebrahim
Investing.com - The Dow jumped above a key milestone Tuesday, as easing uncertainty over the U.S. presidential transition paved the way for investors to get even more bullish on value stocks.
The Dow Jones Industrial Average rose 1.37 %, or 405 points, and had traded as high as 30,117 intraday. The S&P 500 was up 1.55%, while the Nasdaq Composite added 1.22%.
Investor hopes for an orderly transition of power were given a boost after The General Services Administration informed President-elect Biden that federal resources will be made available for his transition into the Oval Office.
The news comes as market participants appear to approve of former Federal Reserve Chair Janet Yellen as Biden's Treasury Secretary nominee.
"Yellen is seen as a very credible choice for the position overall and specifically, well equipped to drive the recovery from the destruction caused by the pandemic as she helped navigate the country in the aftermath of the Great Recession," Stifel said in a note.
Value stocks – those hitched to the performance of the economy – continued to rack up gains as investor bets on a quick roll out of the vaccine, speeding up the reopening of the economy.
Financials, industrials, and energy paved the way for the broader market rally, with the latter up more than 4% on rising oil prices.
Oil prices jumped 4% to their highest since the pandemic begun, on optimism over the demand outlook for 2021.
Industrials, meanwhile, were pushed higher by an ongoing rally in the airlines, with American Airlines Group (NASDAQ:AAL) and United Airlines (NASDAQ:UAL) up more than 8%.
The backdrop of mixed economic data and further signs the U.S. consumer, the backbone of the economy, is in trouble did little to thwart the rally on Wall Street.
The consumer confidence index fell to 96.1 in November from an upwardly revised 106.2 in October and came in below the consensus of 98.0. Pantheon Macroeconomics warned that this was "likely not the bottom," though forecast a rebound to take hold in spring.
Housing activity, however, continues to strengthen as home prices rose at the fastest pace in six years.
Tech also powered the broader market higher as the Fab 5 bounced back from weakness seen in a day earlier.
Apple (NASDAQ:AAPL), Amazon.com (NASDAQ:AMZN), Facebook (NASDAQ:FB), Alphabet (NASDAQ:GOOGL) and Microsoft (NASDAQ:MSFT) were higher.
In other news, Ambarella (NASDAQ:AMBA) reported third quarter results that topped Wall Street estimates, sending its shares up 13%.
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