Wall Street's major indexes bounced back on Monday after their steepest weekly loss since March as investors geared up for an event-packed week centered around the U.S. presidential election.

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Market participants expect short-term trading turmoil and major long-term policy shifts related to taxes, government spending, trade and regulation depending on whether President Donald Trump or his Democratic challenger Joe Biden wins the White House race.

Biden is ahead in national opinion polls, but races are tight in battleground states that could tip the election to Trump. Analysts said the outcome most likely to shake equity markets in the near term would be no immediate outcome at all on Tuesday night.

"Traders are trying to position themselves to the idea that just having a result will be good for the market," said Rick Meckler, a partner at Cherry Lane Investments in New Vernon, New Jersey.

Investors betting on a Biden administration, which is expected to deliver a massive fiscal stimulus and promote green energy, have fueled a rally in solar stocks, industrials and small-cap names in recent weeks.

On the other hand, JP Morgan has listed Bank of America, Wells Fargo and Citigroup in its "Trump basket" of stocks. The S&P banks index added 0.6 percent.

The S&P 500 ended a turbulent week at near six-week lows on Friday after quarterly reports from technology mega-caps failed to impress and on surging coronavirus cases in the United States and Europe.

The CBOE volatility index, known as Wall Street's fear gauge, inched lower on Monday after ratcheting up to near five-month highs last week.

Focus this week will also be on the Federal Reserve's two-day policy meeting, the monthly jobs report and earnings from about a quarter of the S&P 500 companies, including chipmaker Qualcomm, carmaker General Motors and insurer American International Group Inc.

At 09:45 a.m. ET, the Dow Jones Industrial Average rose 225.94 points, or 0.85 percent, to 26,724.90 and the S&P 500 gained 29.13 points, or 0.89 percent, to 3,299.09. The Nasdaq Composite gained 116.27 points, or 1.07 percent, to 11,027.86.

Among the biggest supports to the S&P 500 were Apple Inc, Facebook Inc and Amazon.com Inc, all of which rose between 0.8 percent and 1.3 percent after falling sharply in the previous session.

All major S&P sectors were higher, with technology and consumer staples leading gains.

Estee Lauder Cos Inc rose 5.8 percent after the cosmetics company beat estimates for quarterly results, benefiting from strong Chinese demand and a surge in online orders for its skincare products.

Market research firm Nielsen Holdings Plc gained 7 percent on plans to sell its consumer goods data unit for $2.7 billion to private equity firm Advent International.

Advancing issues outnumbered declining ones on the NYSE by a 4-to-1 ratio; on Nasdaq, a 3.3-to-1 ratio favored decliners.

The S&P 500 posted three new 52-week highs and two new lows; the Nasdaq Composite recorded 22 new highs and 83 new lows.

Note: This story has been updated to incorporate latest developments.

First Published:Nov 2, 2020 8:37 PM IST