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 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 mainly in place, and until that changes, longer term perspective and the moderate for stocks will be good, Essaye included.
Apple led the Dow higher, rising 2.5 %. Tech and materials were the best performing sectors in the S&P 500, gaining 0.9 % along with 0.8 %, respectively.
Wall Street is coming off a quiet holiday week wherein the main averages had been flat. The S&P 500 fell 0.2 % last week as some investors got the chips off into the year end. The 30 stock Dow eked out a 0.1 % gain for the very same period.
Profit-taking could ramp up in the final week of the season, which has thus far seen surprisingly strong returns. The S&P 500 has acquired 15.4 % year to date, while the Dow has climbed 6.4 %. The Nasdaq has soared 43.2 % this year 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 following Christmas along with New Year’s celebrations. 2 vaccines by Moderna and Pfizer have started the distribution process this month. And so much over one million individuals in the U.S. have been vaccinated.