Stock Rally Fades as Markets Rattled by Riots in U.S. Capitol by Pro-Trump Mob

Stock Rally Fades as Markets Rattled by Riots in U.S. Capitol by Pro-Trump Mob

01/06/2021

After U.S. financial markets hit record highs earlier Wednesday, stocks pared their gains in the afternoon after violence instigated by pro-Trump rioters erupted in Washington, D.C.

The Dow Jones Industrial Average ended the day up 1.4%, up 437.80 points to a record 30,829.40. That was off its intraday highs, when the index reached as high as 31,022 (+2.2%). The late-session decline came as law enforcement and National Guard members responded to the invasion of the U.S. Capitol by thousands of protesters waving pro-Trump signs and banners.

The market rally earlier in the day was spurred by investor optimism that a Democrat-controlled Senate, coupled with President Biden’s administration and the Democrat-majority House, would result in a new economic stimulus package. The balance of power in the U.S. Senate remained uncertain after Democrats won one seat in the Georgia runoff elections while the other race was too close to call.

Stocks of large tech companies — including Facebook (-2.8%), Amazon (-2.5%), Apple (-3.4%), Google (-0.3%) and Netflix (-3.9%) — stayed in negative territory throughout the day on fears that Democrats would crack down on Big Tech with new regulations or legislation. The Nasdaq Composite index ended the day down 0.6%.

Gainers in the media and telecom space included ViacomCBS, Discovery and Fox Corp. (all three closing up 8.7% for the day), Lionsgate (+7.7%), AMC Networks (+5.1%), AT&T (+2%), Comcast (+1.2%) and Disney (+0.4%).

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