By Yasin Ebrahim
Investing.com – The Dow cut some losses but ended higher on Wednesday, as former Vice President Joe Biden's bid to take to White House was given a huge boost after picking up a wins in Wisconson and Michigan.
The Dow Jones Industrial Average rose 1.34%, or 367 points. The S&P 500 was up 2.15%, while the Nasdaq Composite gained 3.85%.
Biden holds a 253-to-214 electoral college lead over President Donald Trump, after picking up wins in key swing states of Wisconsin and Michigan. Biden is now in ascendency needing to pick up just one win from the outstanding states.
"After a long night of counting, it's clear that we're winning enough states to reach 270 electoral votes needed to win the presidency," Biden said. "I'm not here to declare that we've won, but I am here to report that when the count is finished, we believe we will be the winners."
While the Democrats' path to the White House has cleared up somewhat, a blue wave – Democrats taking the White House and Congress – is unlikely after Senator Susan Collins, Republican of Maine, maintained her seat, denying Democrats a key win that many expected would be tightly contested.
Without a Senate majority, the Democrats may struggle to push through major legislation including a large broad-based stimulus bill, climate change measures, and massive infrastructure spending.
Healthcare and technology led the broader market higher as the fading prospect of a blue wave eased fears that the group may come under pressure from tax hikes and intensive regulatory scrutiny.
“The Democratic Party has become increasingly critical on Internet company market power, with more liberal members, such as Elizabeth Warren [D-Mass.], of the party calling for breakups or utility-like regulation,” Bank of America (NYSE:BAC) analyst Justin Post said in a recent note.
Apple (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT) Alphabet (NASDAQ:GOOGL), Amazon.com (NASDAQ:AMZN) and Facebook (NASDAQ:FB), which together make up a quarter weighting of the S&P 500, were up sharply, with the latter up 8%.
Energy also climbed higher, on a sharp uptick in oil prices after U.S. weekly crude inventories fell unexpectedly.
The U.S. Energy Information Administration reported that weekly crude stock fell by 8 million barrels last week. Economists had expected a build of about 900,000 barrels.
On the economic front, signs of cracks in the labor market just days ahead of the nonfarm payrolls report due Friday was largely cast aside in the shadow of the election.
Private payrolls grew by 365,000 last month, a sharp decline from the 749,000 in September, according to a report released Wednesday by ADP and Moody's (NYSE:MCO) Analytics. That beat economists’ forecast of 650,000.
Also raising some concern about the recovery, services activity slowed in October.
ISM nonmanufacturing data for September showed a fall to 56.6 from 57.8 the prior month, missing expectations of 57.5.
“This month's level indicates continued expansion, but at a slower pace. Combined with this morning's weak ADP data, it does not bode well for Friday's payroll data,” Jefferies (NYSE:JEF) said in a note.
In other news, Uber Technologies (NYSE:UBER) and LYFT (NASDAQ:LYFT) jumped more than 14% and 11%, respectively.
Californians voted against a labor law that aimed to reclassify drivers of the ride-hailing companies as employees rather than independent contractors.