Dow Jones: 400-Point Surge as Investors Cheer Bessent’s Treasury Nomination

What’s Driving the Market Today?

U.S. stocks surged on Monday, with the Dow climbing 400 points as investors welcomed President-elect Donald Trump’s nomination of Scott Bessent for Treasury Secretary. The selection of Bessent, a hedge fund veteran with strong market credentials, signaled a pro-growth approach that calmed concerns about Trump’s protectionist policies. Light volumes due to the shortened Thanksgiving week also influenced trading activity.

Broad-based strength saw more than 450 S&P 500 stocks in the green, while the small-cap Russell 2000 index outperformed with a 1.5% gain. Individual stocks rallied on earnings beats and analyst upgrades, driving sector-wide optimism.

Why Is Scott Bessent’s Nomination Boosting Markets?

Bessent, known for his expertise as a macroeconomic investor, has been viewed as a market-friendly pick. Analysts expect his leadership to help temper some of Trump’s protectionist rhetoric, such as imposing steep tariffs, while emphasizing pro-business measures.

In a recent interview, Bessent advocated for gradual implementation of tariffs and forecasted inflation staying near the Federal Reserve’s 2% target under Trump’s policies. Ed Mills of Raymond James noted that Bessent’s ability to balance trade policies, tax cuts, and deregulation could bolster U.S. GDP growth, boosting investor confidence in equities.

Retail Stocks in Focus: Earnings and Analyst Calls Drive Gains

Retail stocks were in the spotlight Monday. Bath & Body Works surged nearly 20% after reporting earnings of $0.49 per share on $1.61 billion in revenue, beating forecasts.

Oppenheimer reinstated Target as a top pick, projecting a 30% upside after a recent pullback. Target shares rose 2% as analysts highlighted achievable Q4 guidance and a path to higher operating margins.

Macy’s shares fell 3% following disclosures of accounting irregularities. The retailer delayed its official Q3 results after discovering intentional errors related to delivery expenses. Despite the setback, Macy’s affirmed its cash position remains unaffected.

Tech and Financials See Strong Gains

Tech and financial stocks also contributed to Monday’s rally. Robinhood gained 7% after Morgan Stanley upgraded the brokerage to overweight, citing stronger revenue growth potential. MicroStrategy rose 3% after Bernstein doubled its price target to $600, emphasizing the firm’s Bitcoin-driven momentum.

Santander gained 2% after a Morgan Stanley upgrade highlighted the bank’s resilience and capital generation potential. Meanwhile, chipmaker Arm Holdings added 1% as UBS initiated coverage with a buy rating, citing opportunities in artificial intelligence demand.

Market Forecast: Where Could the Market Be Headed Next?

The market appears poised for further gains as investors remain optimistic about Bessent’s ability to guide economic policy effectively. Retail and tech stocks could continue leading the rally, particularly with strong holiday spending forecasts and corporate earnings momentum.

However, upcoming inflation data and the Federal Reserve’s meeting minutes could introduce caution. A dovish Fed stance may reinforce the bullish tone, while hawkish signals could temper sentiment. Overall, the near-term outlook leans positive, with selective opportunities in retail and growth-focused tech sectors.

For a look at all of today’s economic events, check out our economic calendar.