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 direct payments to Americans, instead of $600.
All the bluster neither considerably changed to outlook 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 five 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 medium and longer term view for stocks will be good, Essaye added.
Apple led the Dow higher, rising 2.5 %. Tech & components were the best performing sectors in the S&P 500, gaining 0.9 % as well as 0.8 %, respectively.
Wall Street is actually coming off a peaceful holiday week wherein the key averages were flat. 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 might ramp up in the very last week of the year, that has so far seen astonishingly strong returns. The S&P 500 has acquired 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 ongoing Covid 19 pandemic.
Dr. Anthony Fauci warned on Sunday that the country might 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 much more than one million men and women in the U.S. are vaccinated.