Today’s stock market gains come despite all the election uncertainty, but may suggest optimism for a second stimulus package down the line.
(CBS Detroit) — Election day has come and gone, and the country is still waiting to see whether Donald Trump or Joe Biden will be president for the next four years. As of Wednesday afternoon, multiple battleground states remained too close to call. Despite the uncertainty, the stock market is once again reacting positively. The Dow Jones was up over 700 points early Wednesday afternoon. The S&P 500 and the NASDAQ, which is more technology-oriented, also showed significant gains in early trading. All three finished up for the day. What does this stock market reaction mean in light of the 2020 election? Investors like certainty. Yet, despite this truism, they’re pushing stocks up. That could change if the uncertainty drags on too long. With so many Americans voting and voting early, that is a possible scenario. Investors are afraid of a protracted and contested sorting-out process, one that adds uncertainty to the market in these already uncertain times. A contested election, seen as a worst-case scenario, could lead to sharp swings in the market. >>MORE: Stimulus Package Update: What Happens To The Economy Without A Second Stimulus? A contested election remains a distinct possibility. Trump has already claimed victory in multiple key states where the counting of ballots continues and the race remains too close to call.
