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 immediate payments to Americans, rather than $600.
All of the bluster neither considerably changed to outlook 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 largely in place, and until that changes, the medium and longer-term view for stocks will be good, Essaye added.
Apple led the Dow higher, rising 2.5 %. Tech and materials 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 wherein the key averages were level. The S&P 500 fell 0.2 % last week as several investors got the chips off to the year-end. The 30-stock Dow eked out a 0.1 % gain for the same period.
Profit-taking might ramp up in the very last week of the season, that has thus far seen surprisingly strong 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 season as investors favored high growth technology labels while in the ongoing Covid-19 pandemic.
Dr. Anthony Fauci warned on Sunday that the nation might see a surge in new Covid-19 infections after Christmas along with New Year’s celebrations. Two vaccines by Moderna and Pfizer have begun the distribution process this month. And so much over one million folks in the U.S. have been vaccinated.