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.