The Dow Jones Industrial Average and S&P 500 reached record highs on Friday, capping off their best week in a year following Donald Trump’s election victory. The Dow rose 259.65 points, or 0.59%, to close at 43,988.99, trading above 44,000 for the first time ever during the session. The S&P 500 increased by 0.38% to close at 5,995.54, briefly surpassing 6,000 points.
The tech-heavy Nasdaq lagged slightly, up just 0.09% to 19,286.78, but still set an intraday record high. All three indexes ended the week at all-time highs, with the S&P 500 climbing 4.66%, the Dow increasing by 4.61%, and the Nasdaq outperforming with a 5.74% advance. The small-cap Russell 2000 surged 8.57%.
Investors generally see a Republican-controlled government as favorable for deregulation, potential mergers and acquisitions, and proposed tax cuts.
Markets hit record highs post-election
However, concerns about the federal deficit and increased tariffs have sparked fears of rising inflation.
Certain stocks associated with Trump saw notable gains, such as Tesla, whose CEO Elon Musk campaigned with Trump, rising 8.2% and achieving a market cap exceeding $1 trillion. The Federal Reserve raised interest rates by a quarter percentage point on Thursday, with Fed Chair Jerome Powell expressing optimism about the economy during a press conference following the decision. Despite some concerns on Wall Street about market valuations, the strength of this week’s rally has bolstered investor confidence that there could still be room for further gains in the final months of the year.
Keith Lerner, co-chief investment officer at Truist Wealth, shared, “When everything seems to be working well, you wonder what’s next. Sentiment’s getting a bit stretched, but overall, we still think it’s best to stick with the primary uptrend.”
In corporate moves, the S&P 500 is expected to be rebalanced later this quarter, with engineering firm Emcor being a likely candidate to enter the index. The crypto sector also saw significant activity, with Coinbase shares rising 5% on Friday and Bitcoin inching higher to a new record of $77,014.49.
As the market continues to navigate post-election dynamics, investor sentiment remains cautiously optimistic, with many anticipating further gains despite potential challenges ahead.
