With the conclusion of the 2026 midterm elections, much of the uncertainty surrounding future policies has subsided, leading to a broad-based stock market rally. Nevertheless, the implications of potentially tighter state-level regulations on data centers were reflected in the day's winners and losers. Hyperscalers emerged with significant gains, while chip stocks and electrical infrastructure providers posted losses. Tighter regulations on data center development could prevent hyperscalers from overspending, addressing a major point of contention in the market recently.
The Dow Jones Industrial Average ended the day 1,569 points higher at 53,356. The NASDAQ gained 1.44% to 25,737, while the S&P 500 rallied 1.58% to 7,689. Energy stocks posted heavy losses amid declining oil prices, while industrial stocks ended the day lower, dragged down by electrical equipment manufacturers and defense contractors. All other sectors rallied.
U.S. Treasury yields also declined significantly, with both the 5-year and 10-year Treasury yields falling by 6 basis points to 4.68% and 4.89%, respectively, reflecting expectations that political gridlock could limit potential increases in the federal deficit.
Today's economic data continued to indicate stable employment and economic expansion, although the services sector expanded at a slower pace than expected. Yesterday's earnings reports from chipmakers also demonstrated significant industry growth, suggesting that concerns surrounding semiconductor demand have yet to materialize.
Adams Wealth Advisors would like to thank you for listening to our program. Tomorrow, we will cover earnings from additional chipmakers as well as several consumer discretionary companies.