Wall St gains, small caps hit record high after Trump picks Treasury chief

By Johann M Cherian and Purvi Agarwal

(Reuters) -Wall Street's main indexes gained on Monday, with the small-cap Russell 2000 index hitting an all-time high as investors cheered Scott Bessent's nomination as Treasury secretary and monitored talks of a ceasefire to the Middle East conflict.

President-elect Donald Trump ended weeks of speculation when he named his choice late on Friday, with some investment strategists saying Bessent could take measures to restrain further government borrowing, even as he follows through on fiscal and trade campaign pledges.

Markets also focused on talks of a ceasefire deal between Israel and Lebanon. Oil prices slid, dragging the energy index lower by 1%.

At 10:58 a.m. ET, the Dow Jones Industrial Average rose 405.42 points, or 0.92%, to 44,701.93, the S&P 500 gained 22.42 points, or 0.38%, to 5,991.76 and the Nasdaq Composite gained 82.63 points, or 0.45%, to 19,085.54.

The small-cap index hit an all-time high of 2,464.90 and was last up 2.4%, eclipsing the high it touched three years ago.

"We're definitely seeing a broadening out of leadership in the market," said Adam Sarhan, chief executive of 50 Park Investments in New York.

"Areas that were lagging for most of this year are beginning to outperform, such as the small cap and the mid cap stocks, not just due to Trump, but also due to the Federal Reserve cutting rates."

Expectations that Trump, along with a Republican Congress, can make good on his promise of lower taxes, import tariff hikes and less rigid regulations have been the latest tailwinds for small-cap companies. Small-caps have been in the spotlight since the U.S. Federal Reserve commenced its monetary policy easing cycle in September.

The benchmark S&P 500 was trading above 6,000 points, and has jumped more than 4% since Nov. 4. The Russell 2000 index has surged more than 8% in the same period.

Barclays (LON:BARC ) raised its full-year 2025 forecast for the S&P 500.

However, concerns remain that inflationary pressures could spike and slow the pace of the Fed's monetary policy easing.

Investors have recently swung between expectation of a pause versus a further cut in interest rates at the Federal Reserve's December meeting. The CME Group's (NASDAQ:CME ) FedWatch Tool shows a near 56% probability the central bank will deliver another 25 basis point cut.

Big banks gained, with Goldman Sachs rising 0.44%, JPMorgan Chase & Co (NYSE:JPM ) up 0.40%, while the regional banks index surged 3.6%.

Consumer discretionary stocks led sectoral gains, aided by Amazon.com (NASDAQ:AMZN )'s 1.5% rise.

Later this Thanksgiving week, the personal consumption expenditure report, the central bank's preferred inflation gauge, will be on investors' radar.

Macy's (NYSE:M ) fell 2% after the department-store operator delayed the publication of its third-quarter results due to an accounting issue.

Bath & Body Works (NYSE:BBWI ) raised its forecast for full-year adjusted profit, sending the retailer's shares up 17%.

Retail trading platform Robinhood Markets (NASDAQ:HOOD ) advanced 5.3% after Morgan Stanley (NYSE:MS ) raised its rating on the stock.



Advancing issues outnumbered decliners by a 4.36-to-1 ratio on the NYSE and by a 3.46-to-1 ratio on the Nasdaq.

The S&P 500 posted 97 new 52-week highs and no new lows, while the Nasdaq Composite recorded 301 new highs and 37 new lows.

Source: Investing.com