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. Last Updated: 07/27/2016

Clinton Victory Powers Immediate Stock Surge

NEW YORK -- Postelection hurrahs set off fireworks in the stock market but Wall Street may turn cautious as it waits to get a glimpse at President Clinton's agenda for his second term.


The experts say the ball is in Clinton's court now that the voters have sent him back to the White House for another four years, and his legislative agenda could have a major impact on stocks just as the economy starts to slow.


Investors raced to buy stocks this week, giving their stamp of approval to Clinton's big re-election win and the Republicans' control of Congress.


The Dow Jones industrial average extended its bullish run, setting its 34th record high for the year on Friday and its second biggest weekly gain ever.


The rally, which started the day after the election, was impressive.


The blue-chip index's gain on Wednesday of 97 points or 1.6 percent was the second biggest postelection rise since World War II, and it was just short of the 1.7 percent jump after Ronald Reagan beat President Carter in November 1980.


On Friday, the Dow closed up 13.78 points at 6,219.82 to set its third consecutive record. For the week, it was up 197.89 points -- the second largest weekly rise after the 206.77-point gain in the week of Aug. 2 this year.


Wall Street was happy with the status quo in Washington -- a division of power that has worked very well for stocks during the last couple of years.


The counterbalance between the Democratic administration and the Republican-controlled Congress has also been compatible with the economy.


Already there is concern that the Clinton administration will call off its year-old campaign for a strong dollar, which would encourage foreign investors to skirt the U.S. stock market.


A drop in the dollar would take away the competitive edge that stocks here have had over some of their overseas counterparts.


Jerry Jasinowski, president of the National Association of Manufacturers, first raised the possibility of a policy change this week when he predicted that the White House would de-emphasize the value of a strong dollar as the U.S. economy slows.