The S&P 500 hit a record high yesterday (November 6) after the US election result. The index finished up 2.53% to close at 5,929 points. Even though the index did well, some people American performers he did even better. Based on the type of shares that have gone up, I feel like I can learn something about what could happen from here.

Takeover potential

The best stock yesterday was Discover Financial Services. The share price rose by 20%. This also refers to Capital Onewhich increased by 15%.

There’s currently a $35 billion deal on the line with Capital One looking to take over Discover. That would create the nation’s largest credit card issuer by loan volume. However, it is still awaiting approval from the government. With a Trump victory yesterday, there is much more optimism that he could soon give the green light to do so. Trump is seen as pro-business and has made a key policy pledge to restart the economy.

I think this is a really interesting example of how stocks can move based on something like an election result. It points out that politics influences the stock market, including specific situations like this one.

Of course, nothing concrete has been done, so yesterday’s jump in these two stocks is purely based on speculation. But given that Discover was the biggest winner, it shows the importance investors place on what just happened.

A retail investment favorite is back

One of the other top players yesterday was adze (NASDAQ: TSLA). I am seriously considering buying this stock and should have bought it earlier this summer when the stock went down!

Over the past year, Tesla shares are up 30%, with 15% of that move coming yesterday. One of the key factors here was that Elon Musk became a vocal supporter of Trump in his campaign. So I feel like some speculative traders were using Tesla stock as a way to express their opinion that Trump will win. Equally, if it had lost, I think the stock would have gone down in value.

I don’t invest in stocks for that kind of speculation. But looking forward, I think Tesla could do well. Given that Musk is close to the President, I think he could help influence policy on the EV push. He could also lobby for more government assistance, favorable terms for subsidies and other factors that should ultimately benefit Tesla.

Tesla also stands to gain from some of Trump’s policies, including lower taxation. With some manufacturing plants in the US, they may find more of a competitive advantage over their overseas peers, especially if other companies are hit by tariffs.

As a risk, Tesla stock has a price-earnings ratio ratio of 128. This is very high and could indicate that the stock is overvalued.