Voting in the 2020 presidential election has ended, but the count is far from over. As of 11 a.m. EST Wednesday, there was still no clear winner in the race for the White House, with ballot counting continuing in several of the expected key battleground states. Yet that didn't stop market participants from adding onto the gains that stock markets enjoyed earlier in the week.
The surge for stock markets came amid speculation that Republicans will at the very least keep control of the Senate. That would guarantee a divided federal government for another four years regardless of who's in the White House.
The Dow Jones Industrial Average (^DJI 0.08%) skyrocketed 602 points to 28,082, while the S&P 500 (^GSPC 0.25%) gained 95 points to 3,464 and the Nasdaq Composite (^IXIC 0.95%) moved higher by 443 points to 11,604.
One of the big movers on the day was Biogen (BIIB -0.63%), which had investors excited about prospects totally unrelated to the election. Meanwhile, ride-hailing stocks Uber Technologies (UBER 1.13%) and Lyft (LYFT 5.34%) also saw significant gains on news that will ensure that the companies preserve their business model in an important market for their services.
Could Biogen help cure Alzheimer's?
Shares of Biogen exploded higher by 46% on Wednesday morning. The biotech stock rose on speculation that government regulators could allow the company to move forward on an exciting yet controversial drug candidate to treat Alzheimer's disease.
Biogen has been working on coming up with a viable Alzheimer's treatment for years, and last year, it restarted phase 3 clinical trials for its aducanumab candidate drug. That came as a surprise, because Biogen had previously chosen to halt its development program for aducanumab based on discouraging early results as determined by an independent committee.
Now, Biogen has gotten enough positive feedback to submit aducanumab for approval to treat Alzheimer's, and earlier signs suggest it could get a favorable reception. The Food and Drug Administration scheduled an advisory panel meeting for Friday, Nov. 6, and the prepared materials that staff members produce included some favorable comments for Biogen's drug.
With Biogen shareholders having gotten burned before by becoming overly optimistic, today's gains might seem premature. But with Biogen seeing its legacy blockbuster drugs start to lose strength, anything that reestablishes the biotech giant's pipeline potential is good news for investors.
Hitting the gas
Meanwhile, shares of Uber and Lyft roared higher by 13% and 12%, respectively. The moves came after favorable results on a ballot initiative in California that ensured the ride-hailing services would be able to keep operating as they have in the past.
California voters went to the polls to consider Proposition 22, which specifically allowed Uber and Lyft to continue to classify their gig drivers as independent contractors. In place of statutory protection for employees, the measure simply included minimum wages and a slate of benefits often reserved for employees.
Proposition 22 passed by a wide margin of about 58% to 42%. Without the favorable outcome, ride-hailing companies had said that they'd likely have to boost pricing dramatically or even curtail service entirely. Voters seemed to believe that threat, granting Uber and Lyft an exemption from the state labor laws governing most independent contractors.
The election victory is far from the end of the challenges that Lyft and Uber face. The COVID-19 pandemic is only worsening in many areas, making passengers reluctant to use the service. Nevertheless, getting through this vote was a key element to the long-term success of the ride-hailing business model.