Wall Street surges after Trump wins White House

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NEW YORK, Nov 9 (Reuters) - U.S. stocks rose sharply on Wednesday in a dramatic turnaround from deep overnight losses as Wall Street digested the upset presidential election victory of Republican Donald Trump.

After warning for months that a Trump White House would create uncertainty and damage sentiment, investors poured money into sectors that may benefit from the former reality show star's victory.

That was a steep reversal from the night before, when financial markets reacted violently as Democrat Hillary Clinton's path to victory narrowed and S&P futures dropped 5 percent before a trading limit kicked in.

"The stock market is acting like a teenager. It makes a lot of demands but it doesn't know what it wants," said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma.

Gains of 3 percent each in the heavily weighted healthcare and financials sectors pushed the S&P 500 and Dow Jones industrial average up over 1 percent.

The real estate sector fell 2.48 percent and utilities lost 3.52 percent. Both sectors are proxies for bonds, which also fell.

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Newspapers around the world react to Trump's win
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Newspapers around the world react to Trump's win
A businessman walks past copies of the London Evening Standard newspaper, featuring a picture of U.S. President-elect Donald Trump on its front page, waiting to be picked up in the square mile financial district of the City of London, U.K., on Wednesday, Nov. 9, 2016. Donald Trump was elected the 45th president of the United States in a stunning repudiation of the political establishment that jolted financial markets and likely will reorder the nation's priorities and fundamentally alter America's relationship with the world. Photographer: Chris Ratcliffe/Bloomberg via Getty Images
A Mexican holds a newspaper with headlines referring to the eventual triumph of Donald Trump on November 9, 2016 in Mexico City. / AFP / PEDRO PARDO (Photo credit should read PEDRO PARDO/AFP/Getty Images)
Mexican newspapers with their front page referring to the eventual triumph of US presidential candidate Donald Trump on November 9, 2016 in Mexico City. / AFP / YURI CORTEZ (Photo credit should read YURI CORTEZ/AFP/Getty Images)
A Mexican holds a newspaper with headlines about on the eventual triumph of Donald Trump on November 9, 2016 in Mexico City. / AFP / PEDRO PARDO (Photo credit should read PEDRO PARDO/AFP/Getty Images)
Copies of a special edition of the Financial Times newspaper, featuring a picture of U.S. President-elect Donald Trump on its front page, sit waiting to be picked up in the square mile financial district of the City of London, U.K., on Wednesday, Nov. 9, 2016. Donald Trump was elected the 45th president of the United States in a stunning repudiation of the political establishment that jolted financial markets and likely will reorder the nation's priorities and fundamentally alter America's relationship with the world. Photographer: Chris Ratcliffe/Bloomberg via Getty Images
A Mexican newspaper with its front page referring to the eventual triumph of US presidential candidate Donald Trump on November 9, 2016 in Mexico City. / AFP / YURI CORTEZ (Photo credit should read YURI CORTEZ/AFP/Getty Images)
A Mexican newspaper with its front page referring to the eventual triumph of US presidential candidate Donald Trump on November 9, 2016 in Mexico City. / AFP / YURI CORTEZ (Photo credit should read YURI CORTEZ/AFP/Getty Images)
A Mexican reads a newspaper with headlines about on the eventual triumph of Donald Trump on November 9, 2016 in Mexico City. / AFP / PEDRO PARDO (Photo credit should read PEDRO PARDO/AFP/Getty Images)
View of Guatemalan newspapers informing about the victory of US presidential candidate Donald Trump in their front pages, in Guatemala City on November 9, 2016. / AFP / JOHAN ORDONEZ (Photo credit should read JOHAN ORDONEZ/AFP/Getty Images)
Colombian newspapers report the victory of US presidential candidate Donald Trump on their front pages, in Medellin, Colombia, on November 9, 2016 / AFP / STR / RAUL ARBOLEDA (Photo credit should read RAUL ARBOLEDA/AFP/Getty Images)
An 'I Voted' sticker adorns a newspaper at an election watch party organized by the American Chamber of Commerce in Hong Kong, China, on Wednesday, Nov. 9, 2016. Republican Donald Trump was projected to win North Carolina and Florida, an unexpectedly strong showing in results Tuesday night that potentially throws the balance in the presidential race to Michigan and Wisconsin, key parts of Hillary Clinton's Midwestern electoral firewall. Photographer: Anthony Kwan/Bloomberg via Getty Images
TOKYO, JAPAN - NOVEMBER 09: A man distributes an extra edition of a newspaper featuring a front page report on the U.S. Presidential Election and Republican President-elect Donald Trump on November 9, 2016 in Tokyo, Japan. Donald Trump defeated Democratic presidential nominee Hillary Clinton to become the 45th president of the United States. (Photo by Yuya Shino/Getty Images)
Chilean newspapers report the victory of US presidential candidate Donald Trump on their front pages, in Santiago, on November 9, 2016 / AFP / MARTiN BERNETTi (Photo credit should read MARTIN BERNETTI/AFP/Getty Images)
An Iraqi man holds an edition of Iraqi daily newspaper Azzaman displaying pictures of US presidential candidates Donald Trump and Hillary Clinton in Baghdad on November 9, 2016. Billionaire populist Donald Trump, tapping into an electorate fed up with Washington insiders, was on the verge of a shock victory over Hillary Clinton in a historic US presidential election that sent world markets into meltdown. / AFP / SABAH ARAR (Photo credit should read SABAH ARAR/AFP/Getty Images)
The New York Post newspaper featuring president-elect Donald Trump's victory is displayed on a New York newsstand, Wednesday, Nov. 9, 2016 in New York. Donald Trump claimed his place Wednesday as America's 45th president, an astonishing victory for the celebrity businessman and political novice who capitalized on voters' economic anxieties, took advantage of racial tensions and overcame a string of sexual assault allegations on his way to the White House. (AP Photo/Mark Lennihan)
A Clarin newspaper, left, with a headline reading in Spanish "Trump was winning and U.S begins an era that shocks the world" with a picture of President-elect Donald Trump is prepared to be delivered outside a building in Buenos Aires, Argentina, Wednesday, Nov. 9, 2016. (AP Photo/Natacha Pisarenko)
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"When you look at Trump's plans, they are actually pro-market," said Nadia Lovell, U.S. Equity Strategist at J.P. Morgan Private Bank in New York.

"Increased fiscal spending, that's great for infrastructure and defense names, less regulations that help banks, less involvement in healthcare - things that worried the market before."

A curb on drug pricing was a key campaign theme for Clinton, while Trump has called for repealing the Affordable Care Act and loosening restrictions on banks enacted after the financial crisis.

At 3:05 pm ET, the Dow Jones industrial average was up 1.54 percent to 18,614.99 points and the S&P 500 had gained 1.24 percent to 2,166.09.

The Nasdaq Composite had added 1 percent to 5,245.54.

Republicans maintained their majorities in both chambers of the U.S. Congress, potentially enabling the party to reshape Washington with two years of "unified" government.

"Regardless of the fact you had a Republican sweep, there are still checks and balances in place," said Art Hogan, chief market strategist at Wunderlich Securities in New York.

"So you are going to have some of your more fiscally conservative Republicans that will certainly slow (Trump) down from doing anything crazy in terms of policy changes."

Wall Street is typically seen as preferring gridlock, or shared control of the White House and Congress, than a sweep of both chambers of Congress and the presidency.

The CBOE Volatility index, a gauge of investor anxiety, fell 20 percent and was on track for its biggest daily drop since late June.

Big pharmaceutical shares gained, with Pfizer jumping 8.3 percent, the biggest driver of the S&P 500's gains. The iShares Nasdaq Biotechnology ETF surged 8.7 percent and was on track for its biggest daily percentage gain in eight years.

Among financials, JPMorgan Chase surged 5.7 percent, on pace for its best day in nine months, while Wells Fargo rose 6.06 percent.

Advancing issues outnumbered declining ones on the NYSE by a 1.27-to-1 ratio; on Nasdaq, a 2.47-to-1 ratio favored advancers.

The S&P 500 posted 58 new 52-week highs and 14 new lows; the Nasdaq Composite recorded 179 new highs and 94 new lows. (Additional reporting by Rodrigo Campos, Chuck Mikolajczak, Tanya Agrawal and Yashaswini Swamynathan; Editing by Chizu Nomiyama)


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Markets

S&P 500 2,241.35 29.12 1.32%
DJIA 19,549.62 297.84 1.55%
NASDAQ 5,393.76 60.76 1.14%
DAX 10,986.69 211.37 1.96%
HANG SENG 22,800.92 125.77 0.55%
NIKKEI 225 18,496.69 136.15 0.74%
USD (per EUR) 1.08 0.00 0.35%
USD (per CHF) 1.01 0.00 -0.27%
JPY (per USD) 113.64 -0.39 -0.35%
GBP (per USD) 1.26 0.00 -0.33%

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