The Dow Jones Index had its best week since 2011, when it rose approximately 5.4 percent after President-elect Donald Trump’s election victory.
“The Republican sweep across Washington should pave the way for tax reform at both the individual and corporate level. America’s largest multinational companies will almost assuredly have the opportunity to repatriate some of its foreign cash holdings for a modest penalty,” Jeremy Klein, chief market strategist at FBN Securities, told CNBC.
Stocks skyrocketed after Trump’s upset victory over Hillary Clinton, as investors considered the potential benefits of increased government spending and less regulation of financial markets.
The Dow closed at an all-time high Thursday while the S&P 500 and Nasdaq were close to reaching record highs for Friday.
Financial markets, as well as many pollsters, political analysts, and the media, had expected Clinton to win the presidency.
“The market is giving Trump the bullish benefit of the doubt,” Adam Sarhan, CEO of 50 Park Investments, said. However, “if he starts going off the deep end, whether on foreign policy or something else, then that could be bad for the market.”
Analysts say the market will be bullish through the end of the year and into 2017, when Trump takes office.
Because of the positive economic effect Trump’s election to the presidency has had on the markets, the U.S. Federal Reserve might raise interest rates at its next policy meeting December 13-14.