Wall Street continued its rise Thursday, capping a 24-hour period of record highs despite an assault on the Capitol by supporters of President Donald Trump.
The Dow Jones Industrial Average reached an intra-day high of just over 31,000 on Thursday, the S&P 500 rose by 1.4 percent to trade above 3,800, and the Nasdaq breached 13,000 for the first time.
Investors mostly rebuffed Wednesday's chaos in Washington, D.C., as an "isolated event," rather than a larger movement that would affect the economy. "The market is looking forward to earnings and growth down the road,” Peter Tchir from Academy Securities told CNBC on Thursday.
The rally comes after Democrats swept both seats in Georgia’s critical runoff elections, giving the party control of the Senate. That has cemented investor confidence that the new administration will introduce more fiscal stimulus and bring about economic growth.
“The Democrats sweeping the Georgia elections means that stimulus ... and confidence in the economy, is going to remain the main story,” said Alec Young, chief investment officer at Tactical Alpha.
Investors also parsed the week's labor market data: Wednesday's ADP payroll report showed a sharp decline in company employees, down 123,000 in December, while economists had predicted a gain of around 60,000. The Labor Department said last week's initial jobless claims totaled 787,000, down from one week earlier but still four times their pre-pandemic level. The crucial monthly employment snapshot from the Bureau of Labor Statistics is due at 8:30 a.m. Friday, and is expected to show just 50,000 jobs added in December and an unemployment rate that has ticked up to 6.8 percent.
“There should be no mystery as to why the markets didn’t care about what happened in the Capitol yesterday, however disturbing, disgraceful, and embarrassing it was,” Peter Boockvar, chief investment officer at Bleakley Advisory Group, told CNBC. “It’s because it has no bearing on the direction of the economy, earnings and interest rates. It’s that simple.”
