Stocks up as Trump picks VP in generational shift

Stocks rose as wild volatility calls failed to materialize after Donald Trump’s assassination attack bolstered his chances of taking over the White House. He tapped JD Vance as his running mate.

The S&P 500 closed near its all-time highs. Trump Media & Technology Group Corp. soared 31%. Conservative video network company Rumble Inc. was up 21%. Trump’s rising odds of victory bolstered oil producers, gun makers and private prisons. His pro-crypto stance lifted Bitcoin and related companies. Tesla Inc. rallied as Elon Musk endorsed Trump. Solar and pot firms sank as Democrats are seen as being more friendly toward the sectors.

Vance is 39, nearly four decades younger than Trump, 78, offering a fresh voice to Republican efforts to bolster their appeal to the working-class workers who were once a bedrock of the Democratic party in battlegrounds such as Michigan, Wisconsin and Pennsylvania. The chances of the presumptive Republican candidate winning a second term increased in the aftermath of Saturday’s shooting, according to PredictIt data.

“We were shocked by the attempt on former President Trump’s life, but suspect that markets will digest the news quickly and with little fanfare,” said John Stoltzfus at Oppenheimer Asset Management. “Shocking events tend not to deter investors, who we expect will remain focused on economic and earnings results.”

Traders also kept a close eye on remarks from Jerome Powell, who said recent data has provided greater confidence that inflation is heading down to the 2% goal.

The S&P 500 rose to around 5,631. Megacaps were mixed. Apple Inc. hit a fresh peak after being named a top pick at Morgan Stanley. Nvidia Corp. fell. The Russell 2000 of smaller firms added almost 2%. Goldman Sachs Group Inc. gained as a surge in profits outweighed plans to moderate the pace of buybacks. Macy’s Inc. tumbled after ending buyout talks.

U.S. 30-year yields rose above the two-year for the first time since January on bets Trump would pursue an expansive fiscal policy if he wins the November election. The dollar edged up.

“The only reason to not cut in July is some mindless institutional nonsense about ‘well we need to set the markets up for it,’ ” said Neil Dutta at Renaissance Macro Research. “I don’t really understand it, but it is what it is.”

To Mark McCormick at TD Securities, markets seem “less fussed about elections” and much keener to enjoy the slide in US data surprises, especially the latest consumer-price index reading.

“Everyone is passing around their favorite Trump trades – but I think we’ve seen over the past century that stock market moves are more random than what a president can dictate,” said Peter Boockvar at the Boock Report.

“We may get a little rally, a Trump bump if you will” and could experience some volatility as political rhetoric will heat up into the Republican Convention, said Jay Woods at Freedom Capital Markets.

A U.S. judge dismissed the criminal case accusing Trump of mishandling classified information, an extraordinary turn of events nearly two years after FBI agents searched his Florida estate for missing national secrets and as he strives to regain the White House.

Election years are typically good for stocks, and barring major market mishaps such as the dotcom bust or the great financial crisis, the S&P 500 Index tends to notch robust gains. In fact, the benchmark has risen in almost every election year since 1960, with the exception of 2000 and 2008. That record has improved further in recent years. In the three election years since 2008 – 2012, 2016, 2020 – the benchmark index rose at least 10%.

Elsewhere, most base metals dropped on further signs of soft Chinese demand.

Corporate Highlights:

—BlackRock Inc. hauled in $51 billion of client cash to its long-term investment funds in the second quarter, pushing the world’s largest money manager to a record $10.6 trillion of assets.

—JPMorgan Chase & Co. became the first of Wall Street’s six biggest banks to tap the US investment-grade bond market after reporting second-quarter earnings, opening the door for an expected flood of issuance from the firms.

—Google parent Alphabet Inc. is in talks to acquire cybersecurity startup Wiz Inc., according to a person familiar with the matter.

—International Business Machines Corp.’s proposed $6.4 billion takeover of software maker HashiCorp Inc. will undergo an in-depth antitrust review by the US Federal Trade Commission.

—Cleveland-Cliffs Inc. agreed to buy Canadian steelmaker Stelco Holdings Inc. for about C$3.85 billion ($2.8 billion), in the company’s first major move after losing out in its bid for United States Steel Corp. last year.

—The flight crew on a Southwest Airlines Co. aircraft that took off from a closed runway in June overlooked a key notice warning of the closure, US safety investigators said in a preliminary report.

Key events this week:

—US retail sales, Tuesday

—Morgan Stanley, Bank of America earnings, Tuesday

—Fed’s Adriana Kugler speaks, Tuesday

—Eurozone CPI, Wednesday

—US housing starts, industrial production, Wednesday

—Fed Beige Book, Wednesday

—Fed’s Thomas Barkin speaks, Wednesday

—ECB rate decision, Thursday

—US initial jobless claims, Philadelphia Fed manufacturing, Conference Board LEI, Thursday

—Fed’s Mary Daly, Lorie Logan and Michelle Bowman speak, Thursday

—Fed’s John Williams, Raphael Bostic speak, Friday

Some of the main moves in markets:

Stocks

—The S&P 500 rose 0.3% as of 4 p.m. New York time

—The Nasdaq 100 rose 0.3%

—The Dow Jones Industrial Average rose 0.5%

—The MSCI World Index was little changed

Currencies

—The Bloomberg Dollar Spot Index rose 0.2%

—The euro was little changed at $1.0898

—The British pound fell 0.2% to $1.2968

—The Japanese yen was little changed at 157.92 per dollar

Cryptocurrencies

—Bitcoin rose 5.5% to $63,424.23

—Ether rose 6.5% to $3,410.42

Bonds

—The yield on 10-year Treasuries advanced four basis points to 4.23%

—Germany’s 10-year yield declined two basis points to 2.47%

—Britain’s 10-year yield was little changed at 4.10%

Commodities

—West Texas Intermediate crude fell 0.3% to $81.97 a barrel

—Spot gold rose 0.4% to $2,421.87 an ounce

This story was produced with the assistance of Bloomberg Automation.