Dow roars past 30,000 for first time on back of Biden transition start and Yellen to Treasury news

The Dow Jones Industrial Average hit 30,000 for the first time ever as Wall Street reacted to Donald Trump allowing the start of a formal transition period for President-elect Joe Biden.

The major US index jumped 400 points on Tuesday morning, just hours after Mr Trump told the GSA and his team to begin cooperating with the Biden transition team, even while tweeting “we concede nothing to fake ballots”. The increase also comes after reports that Mr Biden plans to nominate Federal Reserve Chairman Janet Yellen as Treasury secretary.

US markets had soared in recent weeks to new highs after announcements from Pfizer and Moderna that they have Covid-19 vaccines that they believe are effective, drugs that Anthony Fauci, the country’s top infectious disease official and a sometimes-Trump critic, has said are safe despite being developed quicker than normal.

The Dow appeared eager to move onto the Biden administration after weeks of a stalled transition, as Mr Trump mounted legal challenges in several swing states. But his team has, so far, failed to win a major court case or invalidate any ballots that went for Mr Biden. 

During her time as Fed chair under Presidents Barack Obama and Trump from 2014-2018, Ms Yellen presided over steady economic growth. She is a believer in low interest rates, and earlier this year urged Congress and the Trump administration to strike a deal to extend $600 weekly payments to those out of work during the coronavirus pandemic, calling it “catastrophic” to not do so.

“We need the spending that those unemployed workers can do," she told a House committee.

She is respected by members of both parties and expected to be confirmed, though she has sharply criticized Mr Trump, who GOP lawmakers continue supporting in his so-far unsuccessful legal fight to terminate hundreds of thousands of for-Biden votes and get to the 270 electoral votes needed to secure a second term.

“I doubt that he would even be able to say that the Fed's goals are maximum employment and price stability, which are the goals that Congress has assigned to the Fed,” she said in February 2019. "He's made comments about the Fed having an exchange rate objective in order to support his trade plans, or possibly targeting the US balance of trade.

“And, you know, I think comments like that shows a lack of understanding of the impact of the Fed on the economy, and appropriate policy goals,” Ms Yellen told Market Watch.

During the final year of her tenure as Fed chair, she never publicly clashed with Mr Trump, although he did decide to replace her with Jerome Powell at the end of her term.

Mr Trump and his hand-picked central bank chief have clashed, though mostly with the president attacking Mr Powell’s resistance to lower interest rates. That conflict has at times made US markets jittery.

The incoming president is not expected to publicly bash the Federal Reserve or its leader on Twitter, experts say.

Mr Biden is slated to speak around 1 p.m. ET about his Cabinet-level national security nominees; Ms Yellen’s announcement could come next week. 

Both could further send the Dow and other American indexes northward.