[Wash Examiner] The three major U.S. stock indexes climbed Wednesday after Democrats won a majority in the U.S. House of Representatives while Republicans kept their majority in the Senate.The blue-chip Dow Jones Industrial Average climbed 2.1 percent to 26,180 while the broader S&P 500 added 2.1 percent and the tech-heavy Nasdaq rose 2.6 percent.
The post-election rally, while sizable, is nonetheless unlikely to signal the end of market volatility fueled by President Trump's escalating tariffs, which include duties on $250 million of Chinese imports, and rising interest rates as the Federal Reserve works to maintain economic stability.
It may indicate, however, that some investors were concerned about the possibility of a larger "blue wave," Justin Waring, a strategist with the chief investment office of UBS Wealth Management, told the Washington Examiner.
"Markets do climb the wall of worries," he noted. From an investment perspective, "the real risks of a blue wave were that Democrats could capture the Senate, too."
But even that wouldn't have had any significant impact on the loosened regulations or the GOP-led tax cuts that fueled the market's animal spirits, Waring said. "When you have the presidency, you have veto power, and even if Democrats won every Senate seat, they wouldn't have had enough to override a veto."
The markets had largely anticipated a Democratic victory in the House, where a new majority may step up oversight of businesses including large financial institutions. Other industries, like pharmaceutical manufacturers, could also be under greater scrutiny, while bipartisan support for data privacy legislation may threaten top technology firms.