* U.S. stocks jump on light buying, Dow up 1 pct
* U.S. election keeps markets subdued
* Euro steady after hitting two-month low before Greece
* Gold poised for biggest one-day rise since September
By Richard Leong
NEW YORK, Nov 6 Wall Street stocks jumped on
Tuesday as American voters went to the polls, with the U.S.
presidential election keeping trade subdued while the euro held
steady despite uncertainty over Greece's next financial aid
Polls indicated President Barack Obama and Republican
challenger Mitt Romney remained in a neck-and-neck race,
although the Democratic incumbent had a slight edge in several
key swing states.
The general view on Wall Street is that a Romney win would
favor stocks due to the perception his policies are
pro-business, while another Obama term would favor bonds due to
views his policies would keep interest rates low.
Analysts downplayed the stock market's advance as traders'
betting on a Romney victory.
"There's been a lot of talk that once the election is
decided, no matter how it went, just to have the uncertainty
over would be good for the market," said Rick Meckler, president
of hedge fund LibertyView Capital Management LLC in Jersey City,
Traders seemed more concerned over how the election results
will affect the U.S. government's handling of the "fiscal
cliff," the $600 billion in automatic tax hikes and spending
cuts set to kick in on Jan. 1 unless Congress takes action.
Economists have said the spending cuts and tax hikes could
ignite a new recession in the world's biggest economy, while
Europe continued to struggle with a prolonged debt crisis that
has hurt regional growth.
There is no clear consensus in financial markets on whether
Obama or Romney could reach a timely deal with leaders of the
opposing party to avoid the fiscal cliff.
"We do know this much," said Peter Kenny, managing director
at Knight Capital in Jersey City, New Jersey. "Though the
resident in the White House may change, the face of Washington
is still going to be one of tremendous gridlock, discord and
dysfunction, and markets are going to force Washington to come
to terms with the dysfunction."
The winner will also decide who will head the Federal
Reserve. There has been speculation Chairman Ben Bernanke, whose
term expires in January 2014, might not want to serve another
term. Romney has said he will not reappoint Bernanke.
"If Obama wins, we would be certain Ben Bernanke would
remain in office as Federal Reserve chairman at least until his
normal term expires," said Peter Fertig, a consultant with
Quantitative Commodity Research in London.
On below-average volume, the Dow Jones industrial average
closed up 133.24 points, or 1.02 percent, at 13,245.68.
The Standard & Poor's 500 Index ended up 11.13 points, or
0.79 percent, at 1,428.39. The Nasdaq Composite Index
finished up 12.27 points, or 0.41 percent, at 3,011.93.
Energy and defense stocks led the market advance, along with
materials and industrial shares, as a Romney victory could
benefit these sectors.
For example, United Technologies rose 2.7 percent to
$79.97, while Exxon Mobil gained 1.1 percent at $91.61.
Among the day's losers, Express Scripts Holding Co
plunged 12.3 percent to $55.15 and was the biggest drag on the
Nasdaq after the pharmacy benefits manager said analysts'
forecasts for its 2013 results were too aggressive, casting
doubt on how well it is integrating its $29 billion purchase of
Medco Health Solutions Inc.
Top European shares closed 0.56 percent higher,
rebounding from Monday's losses, boosted by strength in the
technology and travel and leisure sectors.
Hannover Re, the world's third-biggest reinsurer,
ended up 4.5 percent at 55.90 euros after its quarterly profit
beat forecasts and it lifted its expectations for 2012 and 2013.
World stocks on the MSCI global index ended
0.62 percent higher after back-to-back losing sessions.
Developments in Greece were also keenly followed. The Greek
parliament will vote o n W ednesday on 13.5 billion euros of fresh
spending cuts and tax hikes that are crucial to unlocking 31.5
billion euros in aid. There will be a follow-up vote on Sun day
on an austerity budget for 2013.
"Suffice to say if the vote fails, the euro will drop and
the dollar will rally, but even if the vote passes, any rally in
the euro will be short-lived," said Neil Mellor, currency
strategist at Bank of New York Mellon in London.
The euro recovered against the dollar at $1.2813, little
changed on the day, after the single currency fell to a
two-month low at $1.2764.
The dollar retreated from a two-month high against a basket
of major currencies. The dollar index slipped 0.18
percent at 80.611.
In the bond market, U.S. Treasuries prices and German
government debt fell, reversing Monday's safe-haven gains tied
to uncertainty about the U.S. election.
Benchmark 10-year Treasury notes were down 21/32
in price to yield 1.752 percent, up 7 basis points from Monday.
German Bund futures were down 38 basis points at
In commodity markets, Brent crude oil settled up
$3.34 at $111.07 a barrel and U.S. oil futures jumped
$3.06 at $88.71, tracking gains in equities markets.
Gold posted its biggest one-day gain since mid-September,
rebounding from a nine-week low set o n M onday. Bullion was up
1.9 percent at $1,715.34 an ounce.