The Nasdaq Composite Index yesterday rose 1.2% to close at a new record high of 5,983.82 points, after rising to an all-time intraday high of 5,989.92 points. The benchmark index of the second-largest stock exchange in the world rallied along with the wider US stock markets on Monday, tracking a relief rally that swept through Asian and European markets.
The centrist candidate and market favorite Emmanuel Macron won the first round of the French presidential election. Pro-EU and anti-Frexit Macron is expected to beat right-wing rival Marine Le Pen in a deciding vote on May 7 according to polls, which were mostly right about the first-round results, Reuters reported.
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US equities soared on Monday as investors cheered the results of the first round in the French presidential election. The Dow Jones Industrial Average rose 1.1%, to close at 20,763.89, led by a 3.5% surge in shares of JPMorgan Chase & Co and a 2.9% jump in Goldman Sachs Group Inc.
“The market really seemed to like” the election outcome, Randy Warren, chief investment officer at Warren Financial, said in an interview to the CNBC news channel. “It really surprised me because the other candidate is Le Pen and she’s the sleeper candidate,” Warren added.
On the other side, the French election driven, European stock markets skyrocketed across the board, with the pan-European Stoxx 600 index popping about 2%. The French CAC 40 rose 4.14% and hit a nine-year high.
The euro also rose sharply against most major currencies. The common currency briefly broke above $1.09 against the US dollar and last traded around 1.3% higher at $1.087, Reuters said.
Earlier this month, global markets witnessed a downtrend due to the US missile strikes on Syria and concerns over North Korea’s inflammatory comments. North Korea’s vice-foreign minister Han Song-Ryol had spooked the markets by saying that an “all-out war” would result if the US took military action. “If the US is reckless enough to use military means, from that very day, there will be all out war. Our nuclear weapons protect us from that threat,” vice foreign minister Han Song-Ryol had told the BBC’s John Sudworth. “We’ll be conducting more missile tests on a weekly, monthly and yearly basis,” he had said.
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Yesterday too, at a “national meeting” of thousands of senior military and civilian officials, North Korea’s minister of defense Gen Pak Yong Sik reiterated that the country is ready to use pre-emptive strikes or any other measures it deems necessary to defend itself against the “US imperialists”, PTI reported.
“The situation prevailing on the Korean peninsula is so tense that a nuclear war may break out due to the frantic war drills of the US imperialists and their vassal forces for aggression,” PTI cited him as saying.
Going ahead, the US investors are also gearing up for the busiest earnings week in at least a decade, with over 190 S&P 500 members, including heavyweights Alphabet and Microsoft due to report results. The possibility of a US government shutdown comes as President Donald Trump is about to conclude his first 100 days in office, Reuters said in a report.
Trump has ordered aides to put together a tax plan to cut the corporate tax rate to 15%. Expectations of tax reform have been one of the pillars of the stock markets post-election. Moves across markets point to an unwinding of bets taken in the past few days as traders had turned defensive ahead of the French election, Reuters said in a report.
In France, Le Pen and Macron will face off again on May 7. Most polls show Macron easily beating Le Pen in the second round, CNBC has said.