Stocks once again added back some of last week’s losses on Tuesday, as Wall Street looks to get much-needed clarity on the policy and economic fronts by week’s end, though it’s still not exactly clear when the winner of the U.S. election will be announced.
Though it’s still far from adding back the more than 1,800 points it lost last week, the Dow Jones Industrial Average soared 552 points, or 2.1% on Tuesday–nabbing the index’s biggest one-day gain since July, though it’s still down about 3.5% this year.
Meanwhile, the S&P 500 added back 1.8% on Tuesday, and the tech-heavy Nasdaq–which led last week’s sell-off–climbed 1.9%; they’re up 4% and 23% for the year.
Leading the S&P’s market gains was IT consulting firm Gartner, which popped 13% after a stellar third-quarter earnings beat that far surpassed analyst expectations.
PayPal, on the other hand, was among the day’s biggest losers, shedding 4% after the firm issued weak revenue guidance for next year.
On the election front, Goldman Sachs said in a Tuesday note to clients that there’s a “good chance” the winner of the election will be clear by Tuesday night, pointing to four key battleground states that could be called by day’s end–contrary to many expectations of a contested election outcome.
Global markets also soared on Tuesday: The United Kingdom’s FTSE 100 closed the day up 2.3%, France’s CAC 40 climbed 2.4%, and Japan’s Nikkei 225 ticked up 1.4%.
“Stocks are roaring higher as investors look toward the end of this week, when clarity should be achieved on a number of critical macro topics,” says market commentator Adam Crisafulli, the founder and president of Vital Knowledge Media, adding that Tuesday’s uptick in prices “seems to be a ‘clarity rally’ as investors look forward to finally having the election uncertainty overhang removed.”
Wall Street’s been bracing for major volatility in the case of a contested election or delayed result, but this week has marked a changing tide for what’s otherwise been a few terrible weeks for stocks leading up to the election. Volatility has been at a four-month high in recent days, as the threat of surging coronavirus cases compounds market uncertainty and detracts from a slew of better-than-expected earnings results. Three weeks into third-quarter earnings season, 70% of S&P 500 companies have beaten Wall Street earnings expectations–the highest rate since at least 1998, Goldman Sachs noted in a weekend note, adding that investors are–uncharacteristically–not rewarding earnings beats this quarter.
The Shanghai Stock Exchange said Tuesday that it will suspend Ant Group’s much-awaited initial public offering because of “changes in the regulatory environment” that may require Ant to update some of its registration documents, Bloomberg first reported early Tuesday—an unexpected decision from regulators that could jeopardize a potentially record-breaking public market debut.