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 immediate payments to Americans, rather than $600.
All of 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, founder of The Sevens Report.
The five 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 components were the best-performing sectors in the S&P 500, gaining 0.9 % and 0.8 %, respectively.
Wall Street is coming off a quiet holiday week in which the major averages had been level. The S&P 500 fell 0.2 % last week as several investors procured the chips off to the year-end. The 30-stock Dow eked out a 0.1 % gain for the same period.
Profit-taking could ramp up in the very last week of the season, that has thus far seen surprisingly good returns. The S&P 500 has acquired 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 during the continued 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 begun the distribution process this month. So much more than one million people in the U.S. are vaccinated.