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, rather than $600.
Most of the bluster neither drastically 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 moderate and longer-term view for stocks will be good, Essaye added.
Apple led the Dow higher, rising 2.5 %. Tech & materials had been 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 had been level. 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 same period.
Profit-taking might possibly ramp up in the very last week of the season, which has so far seen surprisingly 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 season as investors favored high-growth technology names during the continued Covid 19 pandemic.
Dr. Anthony Fauci warned on Sunday that the country could see a surge in new Covid-19 infections following Christmas and New Year’s celebrations. 2 vaccines by Pfizer and Moderna have started the distribution process this month. So much over one million people in the U.S. are vaccinated.