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Dow rises greater than 200 points, hits record high as Wall Street kicks off last week of 2020

 Stocks traded higher on Monday in advance of the last trading week of 2020 and as President Donald Trump unexpectedly signed an economic relief bill.

The Dow Jones Industrial Average jumped 207 points, or 0.7 %. The S&P 500 climbed 0.7 %, and the Nasdaq Composite rose 0.6 %. All three major indexes hit record highs at the open.

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 will veto the legislation, demanding $2,000 immediate payments to Americans, rather than $600.

All of 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, founding father 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, the medium and longer-term perspective for stocks will be positive, Essaye added.

Apple led the Dow higher, rising 2.5 %. Tech and components were the best performing sectors in the S&P 500, gaining 0.9 % and 0.8 %, respectively.

Wall Street is actually coming off a quiet holiday week wherein the main averages were 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 same period.

Profit-taking might ramp up in the very last week of the year, that has so far seen amazingly strong returns. The S&P 500 has gained 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 labels while in the continuing Covid 19 pandemic.

Dr. Anthony Fauci warned on Sunday that the nation might see a surge in new Covid-19 infections after Christmas and New Year’s celebrations. 2 vaccines by Moderna and Pfizer have begun the distribution process this month. And so far more than one million men and women in the U.S. have been vaccinated.

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