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 the bluster neither considerably changed to perspective for stocks, as markets still expected (and ultimately 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 mainly in place, and until that changes, the moderate and longer-term perspective for stocks will be positive, Essaye added.
Apple led the Dow higher, rising 2.5 %. Tech & supplies 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 where the key averages were level. 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 very same period.
Profit-taking could ramp up in the last week of the season, that has up to this point seen amazingly good 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 year as investors favored high growth technology labels while in 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 over one million men and women in the U.S. have been vaccinated.