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 immediate payments to Americans, instead of $600.
All of the bluster neither significantly 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 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 as well as supplies were the best performing sectors in the S&P 500, gaining 0.9 % as well as 0.8 %, respectively.
Wall Street is coming off a peaceful holiday week in which the main averages had been flat. The S&P 500 fell 0.2 % last week as several investors procured the chips off into the year-end. The 30 stock Dow eked out a 0.1 % gain for the same period.
Profit-taking might possibly ramp up in the very last week of the season, that has so far seen surprisingly good returns. The S&P 500 has gained 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 while in the continuing Covid 19 pandemic.
Dr. Anthony Fauci warned on Sunday that the nation could see a surge in new Covid-19 infections after Christmas along with New Year’s celebrations. Two vaccines by Pfizer and Moderna have begun the distribution process this month. And so far over one million people in the U.S. have been vaccinated.