Stocks rose on Monday as investors anticipated a boost for the Republican presidential candidate and the GOP in the upcoming elections following the unsuccessful assassination attempt on former President Donald Trump. This optimism was fueled by expectations of friendlier fiscal policies and a broadening of the bull market. Small-cap shares and banks led the gains, with the Dow Jones Industrial Average rising 0.4% and the S&P 500 gaining 0.3%. The Nasdaq Composite also saw a 0.3% increase, supported by a 2% rally in Apple.
Market experts believe that the incident involving Trump will only strengthen his position as the frontrunner in the polls. Companies like Humana and UnitedHealth Group saw their stocks rise over 1% as investors speculated on potential benefits from a Republican administration. The Russell 2000 index reached its highest level since 2022, with Goldman Sachs predicting that small caps could outperform under a second Trump term.
Goldman Sachs and banking ETFs also saw gains, with the SPDR S&P Bank ETF and SPDR S&P Regional Banking ETF both adding over 3%. More than 40 S&P 500 companies are set to report second-quarter earnings this week, including Bank of America, United Airlines, and Netflix. Investors also paid attention to comments from Federal Reserve Chair Jerome Powell, who stated that the central bank is prepared to act before reaching its inflation target of 2% and believes a hard landing scenario for the economy is unlikely.