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 will veto the legislation, demanding $2,000 direct payments to Americans, rather than $600.
All the bluster neither significantly changed to outlook for stocks, as markets still expected (and eventually 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 largely in place, and until that changes, longer-term view and the medium for stocks will be positive, Essaye included.
Apple led the Dow higher, rising 2.5 %. Tech and supplies were the best performing sectors in the S&P 500, gaining 0.9 % along with 0.8 %, respectively.
Wall Street is actually coming off a peaceful holiday week wherein the main averages had been level. The S&P 500 fell 0.2 % last week as some investors took the chips off into the year end. The 30 stock Dow eked out a 0.1 % gain for the same period.
Profit-taking might ramp up in the last week of the year, which has so far seen amazingly good returns. The S&P 500 has gained 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 names during the continuing Covid 19 pandemic.
Dr. Anthony Fauci warned on Sunday that the nation can see a surge in new Covid-19 infections following Christmas and New Year’s celebrations. Two vaccines by Pfizer and Moderna have started the distribution process this month. So much over one million folks in the U.S. have been vaccinated.