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Stocks fly after bush win Original Source Link: (May no longer be active)
http://www.reuters.com/financeNewsArticle.jhtml?type=businessNews&storyID=6705201http://www.reuters.com/financeNewsArticle.jhtml?type=businessNews&storyID=6705201
Stocks Off Highs, Oil Jumps on Bush Win
Wed Nov 3, 2004 03:22 PM ET
By Megan Davies
NEW YORK (Reuters) - U.S. stocks advanced on Wednesday as President Bush won re-election, but slipped off the day's highs after a surge in the price of oil.
U.S. crude oil futures jumped $1.48 to a session high of $51.10 a barrel as Bush's re-election overshadowed a big increase in domestic crude inventories.
Bush's victory was perceived as more bullish for oil markets than a win by Democratic challenger Sen. John Kerry would have been.
Kerry conceded in an extraordinarily close presidential election, buoying Wall Street with the certainty that there would not be a repeat of the 2000 election fiasco.
The Dow Jones industrial average was up 87 points, or 0.86 percent, at 10,123, off its session high at 10,215.51. The Standard & Poor's 500 Index was up 11 points, or 0.94 percent, at 1,141, off its high for the day at 1,147.60. The technology-laced Nasdaq Composite Index was up 12 points, or 0.58 percent, at 1,997, off its session high at 2,020.03.
"We're down just a bit from the highs (in equities) and it looks like it is mostly due to oil," said David Hegarty, head of equity trading for Commerzbank Securities.
On the New York Mercantile Exchange, December crude settled at $50.88 a barrel, up $1.26.
At the open, stocks soared, with the S&P 500 hitting levels not seen since early April. The Nasdaq hit its highest point since July 1, and the Dow was at its highest mark in nearly a month.
The Dow's gain of 1.7 percent matched its best one-day gain of the year, set in March.
In contrast, bond prices were off slightly as investors moved out of Treasuries and into stocks, traders said. The yield on the 10-year U.S. Treasury note rose to 4.07 percent from 4.06 percent late on Tuesday.
With Bush seen as more pro-business than Kerry, Wall Street welcomed the prospect of the Republican administration remaining in place for four more years.
"Bush wants to keep taxes down... and Republicans believe that this is very bullish for corporate profits, and believe it's better for growth of the economy and for jobs," said Robert Robbins, president of Robbins Capital Management.
Advancing stocks included the shares of companies in sectors such as defense and drugs, which are expected to benefit from Republican administration policies.
Drug company Pfizer Inc.'s (PFE.N: Quote, Profile, Research) stock jumped 2.8 percent to $29.50, lifting the S&P 500 index, while shares of defense contractor and commercial airplane maker Boeing Co. (BA.N: Quote, Profile, Research) rose 2.9 percent to $51.31, helping the Dow.
Stocks of oil-related companies also advanced. Bush's policies are viewed by energy analysts as doing more to help big oil companies, while some analysts also argue that a Republican administration could be more supportive of higher oil prices. Among gaining oil stocks was Exxon Mobil Corp. (XOM.N: Quote, Profile, Research) , a Dow component and the world's largest publicly traded oil company, up 1.7 percent at $49.23.
Another boost to stocks was that Bush's re-election signals that a repeal of a tax break on dividends is unlikely, cheering holders of stocks with generous payouts.
Investors had feared the tax break on dividends would have been in danger had Kerry been elected with a Democratic majority in Congress. Shares in high-dividend paying stocks such as Microsoft Corp. (MSFT.O: Quote, Profile, Research) rose, up 20 cents at $28.44.
The election news eclipsed earnings results.
Time Warner Inc. (TWX.N: Quote, Profile, Research) , the world's largest media company, reported a lower third-quarter profit, which included a $500 million legal reserve related to accounting probes at its America Online division. But its stock gained 1.8 percent to $16.57.
© Reuters 2004. All Rights Reserved.
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