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, 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, longer term view and the medium for stocks will be positive, Essaye added.
Apple led the Dow higher, rising 2.5 %. Tech as well as components had been the best performing sectors in the S&P 500, gaining 0.9 % and 0.8 %, respectively.
Wall Street is actually coming off a peaceful holiday week in which the major averages had been flat. The S&P 500 fell 0.2 % last week as some investors took the chips off to the year-end. The 30-stock Dow eked out a 0.1 % gain for the same period.
Profit-taking might ramp up in the last week of the season, that has thus far seen amazingly strong returns. The S&P 500 has gained 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 during the continued Covid-19 pandemic.
Dr. Anthony Fauci warned on Sunday that the nation might see a surge in new Covid 19 infections following Christmas along with New Year’s celebrations. 2 vaccines by Moderna and Pfizer have begun the distribution process this month. And so far over one million folks in the U.S. are vaccinated.