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 direct payments to Americans, rather than $600.
All of the bluster neither significantly changed to perspective 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 mainly in place, and until that changes, the moderate and longer-term perspective for stocks will be good, Essaye added.
Apple led the Dow higher, rising 2.5 %. Tech as well as components were the best-performing sectors in the S&P 500, gaining 0.9 % and 0.8 %, respectively.
Wall Street is coming off a peaceful holiday week where the major 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 very same period.
Profit-taking could ramp up in the final week of the year, which has up to this point seen amazingly strong returns. The S&P 500 has gotten 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 while in the ongoing Covid 19 pandemic.
Dr. Anthony Fauci warned on Sunday that the country might see a surge in new Covid 19 infections after Christmas and New Year’s celebrations. 2 vaccines by Moderna and Pfizer have started the distribution process this month. And so much over one million individuals in the U.S. have been vaccinated.