Nasdaq gains 1% ahead of US Elections

Nasdaq contributed heavily for the stocks to reach upside.

The US stocks moved strongly to the upside on Tuesday as US election outcome stayed the primary factor keeping a caution for markets. The major averages ended the day positively. The Nasdaq surged 259.19 points (1.4%) to 18,439.17, the S&P 500 shot up 70.07 points (1.2%) to 5,782.76 and the Dow jumped 427.28 points (1%) to 42,221.88.

A report from the Institute for Supply Management showed service sector activity unexpectedly grew at an accelerated rate in the month of October. its services PMI rose to 56.0 in October from 54.9 in September, indicating growth. With the unexpected increase, the ISM's services PMI reached its highest level since hitting 56.4 in July 2022.

A separate report released by the Commerce Department showed a significant increase in the size of the U.S. trade deficit in the month of September, as imports surged and exports slumped. Airline stocks substantially moved upside with the NYSE Arca Airline Index soaring by 2.8%.

Housing stocks displayed considerable strength, as reflected by the 2.3% surge by the Philadelphia Housing Sector Index. Biotech stocks too saw considerable strength which drove the NYSE Arca Biotechnology Index up by 1.6%. Brokerage, computer hardware and semiconductor stocks significantly moved upwards, moving higher along with most of the other major sectors.

Asia Pacific stocks moved mostly higher on Tuesday. Japan's Nikkei 225 Index advanced 0.9% while China's Shanghai Composite Index surged by 2.3%.

Most European stocks also moved to the upside on the day. The German DAX Index climbed by 0.6% and the French CAC 40 Index rose by 0.5% , although the U.K.'s FTSE 100 Index bucked the uptrend and edged down by 0.1%.

In the bond market, treasuries recovered from early weakness to close modestly higher. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, dipped 2 bps to 4.28% after reaching a high of 4.36%.

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