US STOCKS-Dow, S&P 500 scale new highs on possible Democrat sweep in Georgia

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* Democrats move closer to Senate control
* Tech behemoths slide on fears of tighter regulation
* Industrials, banks climb on stimulus hopes
* Small-cap Russell 2000 at all-time high
* Indexes up: Dow 1.6%, S&P 1.1%, Nasdaq 0.3%

(Adds comment; Updates market prices)
By Medha Singh and Devik Jain
Jan 6 (Reuters) - U.S. stocks rose on Wednesday with the Dow
and the S&P 500 notching record highs as investors piled into
financial and industrial stocks on bets that a Democratic sweep
in Georgia would lead to more fiscal stimulus and infrastructure
spending.
Financials .SPSY hit a 1-year high, while materials
.SPLRCM , industrial .SPLRCI and energy .SPNY sectors
jumped between 2.5% and 3.4%.
Rate-sensitive bank shares .SPXBK jumped about 5%,
tracking a surge in the benchmark 10-year U.S. Treasury yield.
US/
Democrats won one U.S. Senate race in Georgia and led in
another, moving closer to a surprise sweep in a former
Republican stronghold that would give them control of Congress
and the power to advance President-elect Joe Biden's policy
goals. A final outcome is not expected until later on Wednesday.
"The market is saying we can deal and live with this
political decision," said John Stoltzfus, chief investment
strategist at Oppenheimer Asset Management in New York.
"It is saying if you have the potential to lose the tax
reform package ... the offset to that might be more stimulus to
the economy which in effect could be positive for the markets."
Analysts generally assume a Democrat-controlled Senate,
which could usher in increased fiscal spending while raising the
chances of tax hikes and tougher regulation, would be a net
positive for economic growth globally and thus for most risk
assets. The Russell 1000 value index .RLV , which is heavily
weighted toward cyclical sectors, rose 2.5%, while the growth
index .RLG , with a large tech company weighting, shed 0.1%.
Increased risk of antitrust scrutiny of Big Tech companies
pressured shares of Apple Inc AAPL.O , Microsoft Corp MSFT.O ,
Amazon.com Inc AMZN.O , Google-parent Alphabet Inc GOOGL.O
and Facebook Inc FB.O to down between 0.5% and 1.7%.
Tesla Inc TSLA.O was the only major technology stock
trading higher.
At 11:53 a.m. ET the Dow Jones Industrial Average .DJI
rose 481.33 points, or 1.59%, to 30,872.93, the S&P 500 .SPX
gained 41.22 points, or 1.11%, to 3,768.08, and the Nasdaq
Composite .IXIC gained 37.89 points, or 0.29%, to 12,856.85.
The small-cap Russell 2000 index .RUT jumped 2.5% to a
record high.
Hopes of a vaccine-powered economic recovery in 2021 pushed
Wall Street's main indexes to record highs in late-December,
with sectors that had previously lagged, including banks,
industrials and energy, fuelling the rally.
Invesco Solar ETF TAN.P gained about 10.6% on expectations
that clean energy companies will benefit under a
Democrat-controlled Congress, while bets on decriminalizing
marijuana at the federal level lifted ETFMG Alternative Harvest
ETF MJ.P up 9.3%.
AmerisourceBergen Corp ABC.N gained 7.3% after the U.S.
drug wholesaler said it would buy Walgreens Boots Alliance's
WBA.O drug distribution business for $6.5 billion to expand in
Europe. Dow component Walgreens rose 4%. Advancing issues outnumbered decliners for a 2-to-1 ratio on
the NYSE and a 2.5-to-1 ratio on the Nasdaq.
The S&P 500 posted 75 new 52-week highs and no new low,
while the Nasdaq recorded 370 new highs and 13 new lows.