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 immediate payments to Americans, instead of $600.
Most of the bluster neither drastically 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, longer term outlook and the medium for stocks will be good, Essaye added.
Apple led the Dow higher, rising 2.5 %. Tech as well as materials 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 where the main averages had been flat. The S&P 500 fell 0.2 % last week as some investors procured 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 possibly ramp up in the last week of the year, which has so far seen amazingly 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 season 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 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.