DJI: Dow Jones Jumps 3% in Stunning Post-Election Turnaround, AI Stocks Miss Out

Wall Street reverses its initial election jitters, but Asian chips remain under pressure while gold climbs and sterling awaits the Bank of England.

📈 Dow leads Wall Street’s election reversal

• The Dow Jones surged 3% Wednesday, outpacing the S&P 500’s 1.6% gain and the Nasdaq’s 1.4% advance.
• Investors welcomed greater political clarity after Democrats captured Congress, while falling energy prices offered relief. The session delivered a sharp reversal from an initial overnight selloff.
• The rally extended well beyond technology. Nine S&P 500 sectors advanced, with consumer discretionary gaining 4.2% and five sectors rising at least 3%. Energy fell 4.8%. AI and data-center stocks fell broadly with CoreWeave shedding 10%.

🌏 Global stocks split over the AI outlook

• Asian technology shares missed the broader relief trade Thursday. South Korea’s Kospi fell around 4%, Taiwan lost 1.8% and Japan’s Nikkei slipped 0.5%. Investors worried that political changes in key US states could bring tighter restrictions on data-center development.
• Qualcomm fell more than 6% after hours, with handset-chip revenue dropping 26% to $5.14 billion. Stronger forward sales guidance failed to offset smartphone weakness and declining Apple-related revenue.
• Arm also declined around 2% in extended trading despite beating estimates. Revenue reached $1.44 billion and adjusted earnings hit $0.52 a share, but royalties fell short of expectations.

🛢️ Oil sinks, gold and currencies respond

• Brent plunged nearly 9% overnight to below $100 a barrel, leaving it down some 20% this week. Hopes for an end to the Iran war encouraged selling, although a deal remains unconfirmed. Lower energy costs helped bonds rally and pushed EUR/USD toward $1.1280, a one-month high.
• Gold extended its recovery toward $4,135 Thursday, supported by a weaker dollar and a US 10-year yield near 4.87%.
• Bitcoin had regained $80,000 during Wednesday’s rally. The combination shows investors buying both protection and risk exposure as the initial election uncertainty receded.
• The Bank of England takes center stage today, with markets expecting a rate increase and sterling approaching $1.35. US jobless claims follow at 15:30, ahead of Friday’s payrolls.
• Traders will watch whether incoming data reinforces the rally’s lower-inflation hopes or revives concerns about further tightening.