US stocks rallied on Wednesday after the midterm election results became clearer, with the Dow Jones Industrial Average climbing 3% to 53,356 for its biggest post-midterm election gain since 1982. Investors also reassessed the potential policy implications of the vote. Oil, energy shares and some data center-related stocks fell, leaving the rally uneven across sectors.
Major indexes rise as Treasury yields retreat
The Nasdaq Composite added 1.4% to 25,736, the S&P 500 gained 1.6% to 7,688, and the small-cap Russell 2000 rose 1.6% to 2,856. The Dow led the advance. Only three of its 30 components ended lower: Nvidia fell 3.2%, Chevron lost 3.7% and Caterpillar declined 5.2%.
US Treasury yields fell across the curve. The two-year yield slipped 3.5 basis points to 4.579%, the 10-year yield dropped 6.2 basis points to 4.888%, and the 30-year yield fell 4.7 basis points to 5.277%. The simultaneous decline in yields and rise in equities reflected a reassessment of the election outcome and its possible policy effects.
Data center stocks fall amid regulatory concerns
Keith Parker, UBS head of US and global macro strategy, said candidates who supported pausing data center construction won in several states, including Texas. Exit polls also showed that a majority of voters opposed new data centers in their communities. Parker said the results could lead to more state-level regulation of data centers, weighing on related stocks.
Cloud computing platform CoreWeave fell 9.9%, data center operator Applied Digital dropped 6.7%, and SpaceX declined 3.8%. The moves came as investors focused on the prospect of tighter local permitting and oversight. One session's share-price changes, however, do not establish how policy will develop or what specific effect it may have on individual projects.
Energy lags while most megacaps gain
Nine of the S&P 500's 11 sectors finished higher, including technology, consumer discretionary and consumer staples. Energy fell 4.8%, while industrials lost 1.1%. Front-month West Texas Intermediate crude futures dropped 7.7% to $88.67 a barrel. Investors factored in the possibility of changes to US foreign policy, though the details of any policy shift remain uncertain.
Among Dow components, 3M was the top performer, rising 9.6%, while Sherwin-Williams gained 6.6%. Most major technology stocks advanced: Alphabet rose 3.2%, Amazon gained 6.1%, Apple added 5.3% and Microsoft climbed 6.7%. Nvidia moved in the opposite direction, falling 3.2%, while the VanEck Semiconductor ETF lost 2.8%, reflecting mixed performance across chip stocks.
AMD results beat estimates; Nvidia report due Nov. 17
AMD shares rose 1.0% after the company reported third-quarter results and issued fourth-quarter guidance that exceeded Wall Street expectations. Management cited strong data center demand for enterprise CPUs and AI accelerators. AMD's gain contrasted with declines in Nvidia and the semiconductor ETF as the broader chip sector weakened.
Nvidia CEO Jensen Huang is scheduled to report the company's fiscal 2027 third-quarter results after the US market closes on Tuesday, Nov. 17. The report will provide an update on demand for AI chips and the performance of Nvidia's data center business, making it one of the market's near-term corporate events to watch.