US stocks surged to record highs on Wednesday on hopes of the US monetary policy easing, completely ignoring political upheavals taking place in South Korea and France, news agency AFP reported.
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As a result, the Dow Jones Industrial Average was up 0.7%, closing at 45,014.04, the S&P 500 was up 0.6%, closing at 6,086.49, and the Nasdaq Composite was up 1.3%, closing at 19,735.12.
The Dow finished above 45,000 for the very first time. Most of the gains were from larger tech and AI names like Nvidia and Microsoft.
This came after payroll firm ADP said US private-sector hiring in November was at a lower-than-expected 146,000 jobs, while a survey from the Institute for Supply Management also showed weaker sentiment than expected in the services sector.
Though it is a negative indicator, it boosted expectations that the Federal Reserve will cut interest rates later this month.
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“The market at this point is looking for excuses to go up, and there’s not really anything that might work against that narrative,” the report quoted Steve Sosnick of Interactive Brokers as saying.
What happened in France meanwhile?
French lawmakers voted to oust the government of Prime Minister Michel Barnier just three months after he took office, leading to political instability.
Despite this, the French CAC 40 was up 0.7%, closing at 7,303.28. “Over the last couple of days, it’s (markets) managed to ignore all sorts of inconvenient things and decided that the situation in France doesn’t matter for them,” Sosnick said.
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The South Korean story
In South Korea, President Yoon Suk Yeol quickly reversed the decision to impose martial law.
“The situation in Korea doesn’t matter,” Sosnick added. The South Korean Kospi Index plummeted by 1.4%, closing in at 2,464.00.
However, this was actually less than feared and could have been “much worse,” according to the report which quoted Thomas Mathews, head of Asia-Pacific markets at Capital Economics. Even the South Korean Won rebounded from earlier losses.