After last month’s wild ride, investors were once again bracing themselves for a rocky time this week. While there was plenty of data and earnings to be had, the reason strictly was the midterm elections. There’s no hiding the fact that the political climate in the U.S. is a tumultuous one. And the midterm elections were proven to be a flashpoint for the markets. But it looks like Wall Street received a break. With the Democrats taking the House and the Republicans keeping the Senate, political gridlock is now on the table. And in that inability to get anything done, investors cheered.
At the same time, a new month meant new data. From measures of industrial activity to labor conditions, the economy continues to support a bullish stock market, as did many of the earnings reports released over the week. While guidance numbers seemed to show signs of caution, current profits remained high.
Finally, as if the midterms weren’t enough, the Federal Reserve released its FOMC statement and current interest rate benchmark. As expected, investors saw the decision as a bullish one, indicating that the markets and economy could go higher.
All in all, stocks spent much of the week rising on good news.
Be sure to check out our previous week’s Wrap here, in which investors brushed off the poor October results.