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 many days after Trump suggested he would veto the legislation, demanding $2,000 direct payments to Americans, rather than $600.
Most of the bluster neither substantially 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, longer-term perspective and the medium for stocks will be good, Essaye included.
Apple led the Dow higher, rising 2.5 %. Tech and components had been 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 main averages had been flat. 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 very same period.
Profit-taking might ramp up in the last week of the year, which has up to this point seen amazingly good returns. The S&P 500 has gotten 15.4 % year to date, even though the Dow has climbed 6.4 %. The Nasdaq has soared 43.2 % this season as investors favored high-growth technology labels during the continued Covid-19 pandemic.
Dr. Anthony Fauci warned on Sunday that the country might see a surge in new Covid-19 infections after Christmas and New Year’s celebrations. 2 vaccines by Pfizer and Moderna have begun the distribution process this month. And so much more than one million men and women in the U.S. have been vaccinated.