Dow Jones Jumps 3.71% on News
Investors poured money back into equities on Monday, November 7, after FBI Director James Comey sent a letter to Congress saying the second investigation into presidential candidate Hillary Clinton’s emails yielded nothing which the agency could act upon.
The Dow Jones Industrial Average jumped 3.71% during normal trading hours, while the S&P 500 surged 2.2% after nine straight days of trading losses. (Source: “Dow Jumps 371 Points After FBI Says It Won’t Charge Clinton,” The Wall Street Journal, November 7, 2016.)
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There was a general sigh of relief in markets as the CBOE Volatility Index declined, gold prices fell, and 10-year Treasuries rose above 1.8%. It was a much needed reprieve from the chaos of last week, when rising volatility stacked up continuous losses for investors.
The tumult began on October 28, when Comey announced that new emails had surfaced during an unrelated case against former Congressman Anthony Weiner. Weiner had been married to Clinton’s top lieutenant, Huma Abedin, which is what drew the connection between the cases.
He is under investigation for sending sexually explicit messages to an underage girl, which led the FBI to confiscate his laptop to see its incoming and outgoing communications.
“Since my letter, the FBI investigative team has been working around the clock to process and review a large volume of emails from a device obtained in connection with an unrelated criminal investigation,” Comey wrote to Congress on Sunday. “During that process, we reviewed all of the communications that were to or from Hillary Clinton while she was secretary of state.
Comey had felt compelled to announce this information close to the election because of the previous testimony he had given clearing the Democratic nominee of all charges. That testimony was now in question by the emergence of new evidence, so Comey spoke out publicly.
“Based on our review, we have not changed our conclusions that we expressed in July with respect to Secretary Clinton,” wrote Comey. “I am grateful to the professionals at the FBI for doing an extraordinary amount of high-quality work in a short period of time.”
While the public has yet to decide who they want as the next president of the United States, markets are clearly favoring Hillary Clinton. That much is clear from the volatility caused by her email investigation, and the calm left in the wake of its conclusion.
