Stock market rebounds after election results as oil prices drop sharply

The S&P 500 Index recorded an increase of 1.6 percent, representing the largest daily gain since August of last year. Bonds were also actively traded, while the US dollar suffered its biggest daily loss in two months.

Technology companies are particularly noteworthy, driving the recovery significantly. Shares of Microsoft, Amazon, and Apple rose by more than five percent each. Investors see this as confirmation that growth drivers, particularly the field of artificial intelligence, remain intact. While future regulations by the new Congress are not excluded, the need for data centers and software remains high.

The clarity regarding the new power dynamics in Washington is being positively received by market participants and ends the uncertainty created by the election results.

In contrast, commodity markets recorded a significant decline. The price of Brent oil fell by almost ten percent to below $100. The Democrats’ election victory suggests a more restrictive stance on an escalation of the Iran conflict, which has reduced the risk premium for crude oil.

US Treasury yields have also fallen, attributable to the expectation of a political stalemate in Washington and the associated restrictions on government spending programs. This eases the bond markets and supports stock valuations.

Parallel to this, investors sought alternative investment opportunities, leading to an increase in the Bitcoin price, which for the first time exceeded the $80,000 mark.

Corporate news also influenced price developments. Meta Platforms successfully issued its first Euro-bond with a volume of nine billion euros, with the order book oversubscribed at 53 billion euros.

There were also changes in management: Emma Walmsley, former GSK CEO, has been appointed as the new Chair of the Board of Directors of HP. Kraft Heinz announced the sale of its North American coffee business to optimize its portfolio. In the healthcare sector, CVS Health plans to spin off its pharmacy business, which could represent a historic breakup. At McDonald’s, US sales fell in the third quarter, but less sharply than expected, as higher spending per visit partially compensated for declines in visitor frequency.