Market Update: U.S. Stocks Climb Ahead of Midterm Election Results; Half a Dozen Cryptos Up 10% or More in Last Week
U.S. stocks rose briskly on Tuesday, as investors gauged the Republican Party’s chances of retaining control of both houses of Congress following the much-anticipated midterm elections. Cryptocurrencies added to their recent gains, with bitcoin cash and XRP leading a broadening recovery for digital assets.
All of Wall Street’s major indexes finished in positive territory on Tuesday. The large-cap S&P 500 Index climbed 0.6% to 2,755.50, with all 11 primary sectors finishing in positive territory. Shares of materials and industrials companies were the strongest performers.
The Dow Jones Industrial Average rose 175.62 points, or 0.7%, to 25,637.32. IBM Corp (IBM) was once again near the top of the leader board. Joining it were Caterpillar Inc. (CAT) and Travelers Cos (TRV).
Meanwhile, the technology-driven Nasdaq Composite Index gained 0.6% to close at 7,375.97.
The battle for Congress is underway in the United States, with opinion polls showing a divided outcome. According to latest opinion data, Democrats are expected to take control of the House of Representatives away from the GOP, while the Republicans are forecast to re-take the Senate with a narrow majority. That said, investors are reminded that public polling has been notoriously dubious in recent years, with Brexit and the 2016 U.S. presidential election the most obvious cases of poor sampling.
Although stocks have historically performed well under a divided government, the type of gridlock expected this time around could be detrimental to markets. For starters, the Trump administration has implemented several market-friendly policies, which have engineered the fastest pace of economic growth in years. According to analysts, a divided Congress could impact everything from drug prices to banking regulation and up to defense spending.
Crypto Market Cap Approaches One-Month High
Cryptocurrency prices padded their gains on Tuesday, catalyzed by the sharp and sudden growth of bitcoin cash and XRP. The combined capitalization of all digital currencies rose to $216.9 billion, its highest in nearly a month. Total trade volumes rose 13% to $14.9 billion.
In addition to bitcoin cash and XRP, which have engineered seven-day rallies of 43% and 18%, respectively, six other top coins have also reported double-digit gains over that stretch. Stellar, Litecoin, Cardano, Dash, IOTA and Monero are also in the double-digit growth category.
Bitcoin cash is benefiting from a highly anticipated hard fork scheduled to take place on Nov. 15. BCH holders on Coinbase, Binance and others will receive new tokens at a rate of 1:1. XRP and Stellar XLM are also enjoying strong upside, as demand for cross-border payment platforms continues to grow. Both coins were among the top performers on Tuesday. Bitcoin’s price briefly overtook $6,500 on Tuesday but has since fallen back to around $6,435.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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