President Donald Trump signed a $900 billion Covid-19 relief bill into law, averting a government shutdown and extending unemployment benefits to millions of Americans. The signing came days after Trump suggested he would veto the legislation, demanding $2,000 direct payments to Americans, instead of $600.
All the bluster neither substantially changed to perspective for stocks, as markets still expected (and ultimately received) stimulus of a minimum of $900 billion to pass, wrote Tom Essaye, founder of The Sevens Report.
The 5 pillars of the rally (Federal stimulus, FOMC stimulus, vaccine rollout, divided government and no double dip recession) re main mainly in place, and until that changes, longer term view and the moderate for stocks will be positive, Essaye included.
Apple led the Dow higher, rising 2.5 %. Tech as well as supplies were the best performing sectors in the S&P 500, gaining 0.9 % as well as 0.8 %, respectively.
Wall Street is actually coming off a quiet holiday week where the key averages had been level. The S&P 500 fell 0.2 % last week as some investors procured the chips off into the year-end. The 30-stock Dow eked out a 0.1 % gain for the same period.
Profit-taking might ramp up in the final week of the year, that has up to this point seen astonishingly good returns. The S&P 500 has acquired 15.4 % year to date, although the Dow has climbed 6.4 %. The Nasdaq has soared 43.2 % this year as investors favored high-growth technology names during the continued Covid-19 pandemic.
Dr. Anthony Fauci warned on Sunday that the country may see a surge in new Covid 19 infections after Christmas along with New Year’s celebrations. Two vaccines by Pfizer and Moderna have begun the distribution process this month. And so far more than one million people in the U.S. are vaccinated.