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, instead of $600.
All of the bluster neither drastically changed to outlook 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 materials had been 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 wherein the major averages had been flat. The S&P 500 fell 0.2 % last week as several 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 could ramp up in the final week of the season, that has so far seen surprisingly good returns. The S&P 500 has acquired 15.4 % year to date, even though 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 united states can see a surge in new Covid-19 infections following Christmas along with New Year’s celebrations. Two vaccines by Moderna and Pfizer have started the distribution process this month. So far more than one million individuals in the U.S. are vaccinated.