Small-cap stock-market index surges 3% to record high Wednesday, on track for best day in 2 months after Georgia elections

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The small-cap oriented Russell 2000 index on Wednesday was surging over 3% and on pace for its best day since early November as Democrats were poised to take control of the Senate following early results from Georgia’s closely watched runoff elections Tuesday night. Preliminary voting results show Democrat Raphael Warnock as the winner of one of two Senate runoffs in Georgia early Wednesday, according to the Associated Press, bringing Democrats a seat closer to a Senate majority. Democratic challenger Jon Ossoff was leading Republican Sen. David Perdue with a slight margin. With control of the Senate in sight, Democratic lawmakers may now have more scope to pass more aggressive fiscal measures. Against the backdrop, small-caps were rising on bets that Biden’s plans for infrastructure spending legislation may help to boost the economically sensitive components that tend to make up the Russell 2000. The Russell 2000 index was up 3.2% and and on track for its best daily gain since Nov. 9, hitting an intraday record at 2,041.305 in the process, according to FactSet data. Small-caps weren’t alone in Wednesday’s gains, with the Dow Jones Industrial Average rising more than 500 points to its own record high near 31,000, while the S&P 500 index was up 1.2% in record territory at 3,770, and the Nasdaq Composite Index was lagging its benchmark peers, up 0.4% due to some trepidation about tighter regulations against large-cap tech that could be instituted by President-elect Biden.
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