Dow jumps 200 points to record as traders cheer stimulus bill signing
Stocks jumped to record highs on Monday to start the final trading week of 2020 after President Donald Trump signed an economic relief bill.
The Dow Jones Industrial Average closed 204.10 points higher, or 0.7%, at 30,403.97. The S&P 500 climbed 0.9% to 3,735.36, and the Nasdaq Composite rose 0.7% to 12,899.42.
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 direct payments to Americans, instead of $600. The House is expected to vote on a $2,000 direct payment on Monday, but the GOP-led Senate is not expected to push it through.
“All the bluster neither significantly changed to outlook 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 largely in place, and until that changes, the medium and longer-term outlook for stocks will be positive,” Essaye added.
“Equities seem poised to end the year on a high note, and I think for good reason,” said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management. “There’s additional government stimulus, which is providing some measure of economic stability; medical progress for Covid-19 continues to evolve; and the macro environment is favorable for stocks.”
Reference: CNBC
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