Stocks are closing sharply higher on Wall Street after Donald Trump's upset victory over Hillary Clinton.
Investors hope his plans for infrastructure spending, tax cuts and lighter regulation will benefit the economy. Banks, drugmakers and industrial companies rose the most, while safe-haven assets like utilities slumped.
Bond prices dropped sharply, sending yields higher. The yield on the 10-year Treasury note went above 2 percent for the first time since January.
The Dow Jones industrial average rose 256 points, or 1.4 percent, to 18,589, within 50 points of the all-time high it set in August. The Standard & Poor's 500 index gained 23 points, or 1.1 percent, to 2,163. The Nasdaq composite climbed 57 points, or 1.1 percent, to 5,251.
SMU economist Bernard Weinstien says the market can be fickle but it eventually reflects reality. For now it appears investors are willing to give Donald Trump the benefit of the doubt.
“Number one, the US market is in pretty good shape,” Weinstien said. “Number two, Mr. Trump is pro-business, he says he wants to double the rate of economic growth in the US which has been less than 2 percent a year for the last 3 or 4 years. He has a Republican congress that he can work with.”
Weinstien said a Trump presidency could also be good for Texas energy.
“I think Mr. Trump will pursue a more even handed energy policy, and some of the excessive regulation I think will be rolled back although that can't happen overnight,” Weinstien said.
European stocks also closed higher after markets recovered from early losses in the wake of Donald Trump's victory.
Germany's DAX ended the day 1.6 percent higher at 10,646.01 while Britain's FTSE 100 gained 1 percent to 6,911.84. France's CAC 40 rose 1.5 percent to 4,543.48. All the indexes were lower earlier in the day.
Investors appeared to be calmed by Trump's conciliatory victory speech, which contained little of the brash rhetoric from his campaign. Also, some analysts say that Trump's victory means the Federal Reserve is unlikely to raise interest rates as soon as December, as previously expected. Lower rates have tended to boost global stocks.