US equity-gauge futures advanced after Republicans won a Senate majority for the first time in eight years, gaining control of the two chambers of Congress, and payroll data showed more improvement than expected in October.
December-expiry futures for the Standard & Poor’s 500 Index added 0.6% to 2,018.4 at 8:27 am in New York. Futures for the Dow Jones Industrial Average climbed 94 points or 0.5% to 17,399.
Republicans kept a House majority and claimed enough seats to wrestle control of the Senate from Democrats.
“Republicans are seen as more business friendly, so it’s not surprising if markets react positively to the mid-term results. It could make it easier for decisions to be passed, and clearer decision-making is a good thing in U.S. politics. Markets saw some volatility yesterday, so we could see a bit of a rebound today,” Bloomberg quotes Veronica Pechlaner of Ashburton Ltd as saying.
The S&P 500 has since 1945 jumped an average of 15.1% in years when a Democratic president has faced opposition from a Congress controlled by Republicans, Sam Stovall, an S&P Capital IQ equity strategist.
Time Warner Inc soared 3.6% after stating that profit for the third quarter was 97 cents per share, without taking into account restructuring costs and a one-off tax break.
Equities have risen during the bull market that commenced in March 2009 even without a united Congress in place. The S&P 500 has advanced 69%, taking into account a 30% winning streak in 2013 that was the biggest yearly increase since 1997, since November 2, 2010 when the House saw a Republican dominance as Democrats controlled the senate.
According to MarketWatch, ADP reported on Wednesday that the private sector created more jobs, with employers adding 230,000 jobs. The report can have a bearing market expectations for a key monthly payrolls report expected on Friday.
To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.
To contact the reporter of this story; Jonathan Millet at email@example.com