Why Wall Street is ignoring chaos in Washington

Statements from major companies and CEOs are flooding in after pro-Trump rioters stormed Capitol Hill on Wednesday. One of those included a statement from one of the largest business groups in the United States, the National Association of Manufacturers, calling on Vice President Mike Pence to “seriously consider” invoking the 25th Amendment to “preserve democracy." 

“The outgoing president incited violence in an attempt to retain power, and any elected leader defending him is violating their oath to the Constitution,” the group said in a statement. 

Since President-elect Joe Biden’s win in November, President Trump has refused to concede his loss.

The Dow closed at a fresh all-time high on Wednesday despite a chaotic scene playing out at the US Capitol.

Investors focused on political developments in the nation, starting with the runoff Senate election in Georgia, as well as the breaching of the US Capitol building in Washington.

The prospect of Democrats taking control of the Senate gave the market a boost because it would help President-elect Joe Biden’s economic agenda. The Dow hit the 31,000 mark for the first time in history shortly after midday. But stocks came off their highs in the afternoon as the riots in Washington unfolded.

• The Dow finished 1.4%, or 438 points, higher.
• The S&P 500 closed up 0.6%.
• The Nasdaq Composite fell 0.6%.

Go look at CNN.com right now. Go ahead, we'll wait -- we'll still be here when you get back.

Does that look like the kind of day when the Dow would be up? Yeah, it doesn't to us, either.

But here's the deal: Wall Street rose even as millions of Americans were getting infected with Covid-19. Stocks surged as millions of Americans were losing their jobs. Markets have been up while President Trump has refused to concede the election he clearly lost and has tried to overturn the election results.

That's because Wall Street isn't looking at what's happening right now. It's looking to the future. Stock investors are concerned with whether events will help or hurt the underlying profitability of the companies they're invested in.

So that's why, today, despite unbelievable chaos at the Capitol, Wall Street has remained mostly calm. Investors are cheering Democrats' lead in the Georgia Senate run-off elections, because it means stimulus is more likely, helping to shore up the US economy and keep businesses afloat.

Undemocratic actions of the president and some members of Congress pose a long-term threat. Civil unrest is uneasy, but America has overcome that before and will most likely in this instance, too. Wall Street is betting that this is a lot of bark with no bite.

The Dow and the S&P 500 were still on track to hit a record today, but the indexes trimmed a lot of their gains as a chaotic scene played out at the US Capitol.

Investors view the likely flip of the Senate in favor of the Democrats as a positive for President-elect Joe Biden's economic agenda and further government stimulus.

But supporters of President Trump breached the US Capitol shortly after 1pm ET as lawmakers attempted to count the Electoral College votes certifying Biden's win. An armed standoff was taking place outside the House of Representatives.

Washington, DC has been placed on lockdown. Washington Mayor Muriel Bowser just announced a citywide curfew from 6 pm Wednesday until 6 am Thursday.

Stocks remain sharply higher, aside from the Nasdaq Composite, which is down 0.3%. The Dow is up 1.4%, or 421 points, and still within 200 points of the historic 31,000 mark it hit earlier in the day. The broader S&P 500 is up 0.8%.

The Dow climbed past 31,000 points for the first time in history in the early afternoon, as the market rallied.

Investors are excited about the prospects of more government aid in the months to come. The runoff election in Georgia, where the votes are still being counted, is leaning towards giving the Senate control to the Democrats, which would make it easier for President-elect Joe Biden to pass legislation.

The Dow traded up 2% or more than 600 points.

The market is on track for new record highs as we await the results of Georgia's runoff.

"The market basically expects the Democrats will control Congress and there will be more fiscal aid," said Jason Draho, head of Americas asset allocation at UBS Global Wealth Management.

"If we look at the market reaction today [...] we've seen equity markets up, interest rates going higher," Draho said on the CNN Business digital live show Markets Now.

Worries about higher taxes under the Biden Administration aren't holding the market back, because the risks are offset by hopes for more stimulus, he said.

Moreover, the Democratic party is not a united front when it comes to tax hikes, Draho added. "I think it's easier to get agreement on spending than on tax increases."

People are eating out less and staying home more. That was the theme of 2020 and it isn't stopping as the Covid-19 pandemic continues.

Thats good news for food delivery services like Daily Harvest, which is valued at $230 million, according to Pitchbook.

"Orders have been steadily on the rise," said Rachel Drori, CEO of Daily Harvest.

Online food shopping has become more habituated during the pandemic, she added, which is great news for Daily Harvest, which is launching its own plant-based milk alternatives today.

"I'm confident that people will continue to shop for food online as part of their routine," Drori said.

The runoff election in Georgia could deliver a blue wave and hand over Senate control to Democrats. This would be good news for President-elect Joe Biden and his economic agenda.

"It certainly increases the probability that we see more leftist policy pushed through," Lindsey Piegza, chief economist at Stifel, told Alison Kosik on the CNN Business digital live show Markets Now.

But it's unlikely that Washington will see fringe or far-left policies, she added.

More fiscal aid is likely, which is boosting the market today. And lawmakers have to do more to supplement and artificially support the economy.

"Additional fiscal aid is needed, but it has to be done in a very methodical, very careful manner," Piegza said. "We can't continue to rely on indefinite government support. At some point we have to get back to organic growth."

It's already lunchtime and stocks are still on track for a record-breaking day.

Even though the major indexes have come back a bit from their morning peaks, the Dow and the S&P 500 are still on pace to end the session at fresh all-time highs.

And all this while economists have updated their forecasts for this Friday's jobs report for the worse! Experts now predict the unemployment rate will rise to 6.8%, the first increase since April. Clearly, the reaction to the Georgia runoff election is outweighing worries about the job market today. This may be in part because a single party controlling the Senate, the House and the White House could mean the incoming Biden Administration will have more leeway in getting the country out of the current crisis.

• The Dow rose 1.6%, or 477 points, around midday.
• The S&P 500 was up 1.1%.
• The Nasdaq Composite was up 0.3%.