Wall Street wary after Obama victory
Stock futures drop after the president wins a second term. The next big question: Can Congress avoid the fiscal cliff?
When it became clear late Tuesday that President Barack Obama had won the the 2012 election over former Massachusetts Gov. Mitt Romney, Democrats were ecstatic. Republicans were depressed.
The stock market looked like it would follow the Republicans' lead and open lower.
Futures trading at 5:10 a.m ET Wednesday suggested the Dow Jones industrials ($INDU) will open down more than 100 points.
The Standard & Poor's 500 Index ($INX) is looking at an 11-point loss at the open, and the Nasdaq-100 Index ($NDX) is looking at a 22-point hit.
European stock futures trading suggested a higher open as well, and Asian stocks were mostly higher, especially in Hong Kong and India.
What tipped the election in Obama's favor was winning the key battleground states of Ohio, Pennsylvania, Virginia and Wisconsin. Florida may yet move to the Obama column. Ohio gave him more than the 270 electoral votes needed to win.
While stocks look to open lower, gold (-GC) was moving higher, a suggestion that Wall Street will continue to be wary of the president. Light sweet crude oil (-CL) was lower.
Wall Street's big bet on Romney comes up short
Wall Street invested millions in Romney's candidacy in large part because Obama has antagonized the financial community with calls to raise taxes on the wealthy as part of any deficit reduction package.
An Obama win probably means a bitter battle into next year over the fiscal cliff -- a witch's brew of tax increases and government spending cuts that are set to take effect Jan. 1 unless Congress acts. Many economists believe a stalemate could plunge the nation back into recession.
In addition to the Obama victory, Democrats will maintain control of the U.S. Senate. That means the agenda of the conservative House of Representatives has a much harder path to realize its policy hopes of big tax and spending cuts.
A sign of an economy on the mend?
While the fiscal cliff is gong to be front and center, there is some recent good news for those who worry the economy is falling apart.
The Wall Street Journal reported Tuesday night that Americans are setting up house at the fastest rate in more than six years. That's an indication that recession anxiety, which prompted adult children to move in with their parents and single people to postpone marriage, is starting to ease.
The nation added 1.15 million households in the 12 months that ended in September, according to the most recent Census Bureau data. That's a significant rise from the past four years when an average of 650,000 households were formed annually.
Rising household formation means more students are finding jobs after college, more adult children are leaving their parents' homes and more couples feel confident enough about the future to marry. It could also mean that immigration is picking up.
That's the good news that Obama phases as he prepares for a second term. So is a housing recovery and an automotive rebound.
What's not good is a 7.9% unemployment rate and the coming battle over taxes and spending and the fiscal cliff.
The markets had a good day
Before the returns started to come in, stocks had a very good day. The Dow was up 133 points to 13,246. The Standard & Poor's 500 Index ($INX) gained 11 points to 1,428, and the Nasdaq Composite Index ($COMPX) added 12 points to 3,012.
The rally was fueled by gains in energy, industrial and financial stocks. Crude oil moved higher because of fears that another big storm about to hit the East Coast would disrupt efforts to get gasoline out to service stations and take out power lines again.
Things to do on November 7th:
1 - Stop paying mortgage
2 - Call Vladimir to explain "flexibility" of which Obama whispered is achieved
3 - Buy ammo
4 - Stock up on food and water
5 - Pray....should've been first on list
6 - Determine how much gold I can purchase
7 - Begin removing personal information from grid
8 - Pray
9 - Explain to boss that I don't have to leave house to get entitlement check
10 - Quit job
The only new America is that the have not's / will not's will have to come up with a better plan. As long as there are less people working than collecting, there will never be enough. This have / will is heading to the Caymen Island's. Good luck to Obama and the new
America. Should be interesting to see how you make out when those of us who work decide to leave.
Great job last night Libtards......you have really screwed the pooch this time.
We had a chance to recover with Mitt and Paul but nooo....you progressive commies could not give up the marxist.
Enjoy the coming misery.....idiots.
"Good luck to Obama and the new America. Should be interesting to see how you make out when those of us who work decide to leave."
What's less paper and button pressers in a world sorely in need of self-sufficiency? To those of US who were unfairly terminated in 2007-08 and have endured, realize that the lack of substance in business is because of our absence from the equation. Lord, let thy sheople go (to Hell) and restore the careers of those who made a difference. We are better and stronger for the dumpster experience (we'll talk about that- later) but the whole world needs our abilities now. You know where you can stuff that degree... an education in REAL LIFE is straight ahead. May you learn the uselessness of texting before you run out of food.
Congress cant find the Toilet ! So you think they can avoid the fiscal CLIFF ? Good luck !
They SCREW US WE SCREW THEM ! A trillion dollars of the American citizens to bail out the (TBTF) Banking Cartel ! STOP PAYING YOUR CREDIT CARDS AND MORTGAGES ! They put 50 million Americans in PRISON !
Well the real reason the republicans lost the elections, when elected they declare war on the unions the real working class now I guess they can all pick up their business and move them overseas Oh I forgot they already moved them overseas!
The header should have read: Now We Can Get RID of Wall Street!
I stopped investing in the false markets shortly after 2008 when it was obvious that they were false and phony. REAL Americans don't invest in cardboard cut-out businesses that mass-terminated our careers and gave phony hired-in executives huge compensation packages. I invested in Main Street, not Wall Street and my returns have been REAL and substantial. I am positioned to make progress WITH the country, not to be a pariah that takes food from babies and buys a 12th house or a foreign-made sports car or shares of stock in businesses that undermine us. We have now seen how low America can go when big money and GOP manipulation become too powerful. It's time to Close the Banks, End the Federal Reserve, RECONCILE BOTH and only consider re-opening the banks if they can be made to follow rules, be solvent businesses, not institutional bail-out recipients. We can never have banks that employ pariah who drive us to ruin for profit.
Wall Street-- feel free to collapse now.
Well, the drama queens are out. The same ones that were just rejected by a clear majority of the country that is sick and tired of your fear, smear, conspiracy theories, and hate speech. The right is still in control of the house but has no choice but to compromise and work with the left if they like their jobs or they WILL lose control in 2 years.
As far as the title above, I call bs, the futures would be down any day after closing up 130+ points.
The whiners need to shut off fox scews, rush, and the rest of the right wing hate media, get off your rear ends and improve your lives. Start with taking a little responsibility for you position in life.
Congratulations Obama for a well deserved second term.
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