On Wednesday, the Dow closed at a record high, even as thousands of President Trumpâ€™s supporters stormed the Capitol while Congress was set to confirm Bidenâ€™s election win. Trump has emphatically disputed the results, citing meritless claims of voter fraud, and had encouraged his supporters to attend the rallies. One person was shot during the melee, and the D.C. National Guard was activated.
Overseas investors also seemed relatively unconcerned with the turmoil: Japanâ€™s Nikkei 225 gained 1.6 percent, and the Shanghai Composite Index gained .7 percent. European markets were positive in midday trading, with the exception of Britainâ€™s FTSE100, which was trading down .45 percent.
â€œWith the Democrats now set to control Congress when Joe Biden officially becomes President in a few weeksâ€™ time, the market is now recalibrating the scenario where the future leader has a greater chance of pushing through his policies and thus what the consequences would be on asset classes, economic growth, monetary policy and so on,â€ Russ Mould, investment director at AJ Bell, said Thursday in comments emailed to The Post. â€œPreviously the market seemed to be content with a situation of government gridlock.â€
The mob scenes at the Capitol attracted harsh and unusual criticism from business groups, many of which had applauded Trumpâ€™s efforts to cut down on government regulation and corporate taxes throughout his time in office. Citigroup chief executive Michael Corbat said he was â€œdisgustedâ€ with the rioting, while Stephen Schwarzman, CEO of the Blackstone Group, said he was â€œshocked and horrified by this mobâ€™s attempt to undermine our constitution.â€
The National Association of Manufacturers released an extraordinary statement from its president, Jay Timmons, saying Vice President Pence â€œshould seriously consider working with the Cabinet to invoke the 25th amendment to preserve democracy.â€
But beyond the condemnations, investors were looking down the line toward the likely priorities of the Biden administration. Many investors worry that a Democrat-controlled Senate could ease the path for tax increases and regulatory changes. But flipping the chamber also increases the odds of more fiscal stimulus, boosting companies that have been hard hit by the pandemic and the broader economy.
â€œMarkets will continue to focus on the potential Democratic agenda, which should be broadly positive for cyclical sectors,â€ Jeffrey Halley, senior market analyst with OANDA, wrote in commentary Thursday. â€œGeorgiaâ€™s Democrat clean sweep and its ramifications are likely to dominate markets today, with stimulus sentiment well in the ascendant. The buy everything trade is alive and well, if a little noisy.â€
Bitcoin continued its explosive rally Thursday, surging 11.7 percent to trade above $38,500, bringing the value of the cryptocurrency market above $1 trillion for the first time. In the past 12 months, Bitcoin has soared nearly 400 percent as the global economic slowdown pushed more investors toward alternative currencies.
Gold, an investor safe-haven in times of uncertainty, rose 0.3 percent Thursday to trade at $1,913 per troy ounce.