U.S. equities rose on Wednesday after a series of executive orders from President Donald Trump increased bullish sentiment on Wall Street.
“Traders have been waiting for more details on infrastructure spending and now they have it in a very clear format,” said Naeem Aslam, chief market analyst at Think Markets. “There is nothing bigger than this.”
On Tuesday, President Trump signed executive orders that will make it easier for TransCanada to build the Keystone XL pipeline and for Energy Transfer Partners to build the final uncompleted portion of the Dakota Access pipeline. The orders helped lift the materials sector to a 2.5 percent gain Tuesday.
“There’s no question that some of the executive orders he’s signed are good, especially deregulations,” said Peter Cardillo, chief market economist at First Standard Financial. “Anything else should be seen as a question mark. We don’t know what a wall on the Mexican border would mean for Nafta.”
Trump was expected to roll out executive orders on immigration on Wednesday, starting with steps to tighten border security, including his proposed wall along the U.S.-Mexico border.
U.S. stocks had rallied significantly following the presidential election, with the S&P 500 advancing 6.57 percent since Nov. 8, entering Wednesday trading. The rally was largely propelled by the prospects of lower corporate taxes, deregulation of certain sectors and more government spending.
However, investors should look out for a potential pullback from these levels, said Jeremy Klein, chief market strategist at FBN Securities. “If funds continue to shovel capital into equities in advance of an inevitable reprise of an undesirable bout of skittishness, then shares may suffer a selloff greater in magnitude and duration than I anticipate,” he said.
Investors also paid attention to a series of corporate quarterly results, as Dow components Boeing posted earnings and revenue that beat Wall Street expectations. United Technologies, another Dow component, posted profit and sales that largely met analyst expectations.
In economic news, the FHFA House Price index rose 0.5 percent in November. Mortgage rates, meanwhile, rose 4 percent last week.
Overseas, European equities rose broadly, with the pan-European Stoxx 600 index advancing more than 1 percent. Asian stocks also posted gains overnight, as the Nikkei 225 index popped 1.43 percent.
—The Associated Press contributed to this report.
On tap this week:
Earnings: eBay, Qualcomm, Citrix, WW Grainger, Las Vegas Sands, Cullen/Frost Bankers, Murphy Oil, McKesson, Norfolk Southern
Earnings: Intel, Microsoft, Alphabet, Caterpillar, Comcast, Dow Chemical, Ford, Fiat Chrysler, Unilever, Biogen, Northrop Grumman, Blackstone, Praxair, Potash, Alaska Air, PulteGroup, LM Ericsson, LVMH,Raytheon, Southwest Air, Stanley Black & Decker
8:30 a.m. Jobless claims
9:45 a.m. Markit services PMI
10:00 a.m. New home sales
8:30 a.m. Durable goods
8:30 a.m. Q4 Real GDP
10:00 a.m. Consumer sentiment