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Dow Notches Record High as $900B Stimulus Package Stokes Recovery Hopes

Stock MarketsDec 28, 2020 04:03PM ET
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© Reuters

By Yasin Ebrahim

Investing.com – The Dow closed at an all-time high on Monday, as President Donald Trump signed off on the $900 billion stimulus bill, averting a government shutdown and giving the economic recovery a much-needed boost.

The Dow Jones Industrial Average rose 0.68%, or 204 points. The S&P 500 was up 0.87%, while the Nasdaq Composite rose 0.74%. All three major averages closed at record highs.

Trump had threatened to delay signing the relief package after demanding that Congress amend the bill to boost direct payments to $2,000 from $600 a week to support unemployed Americans.

"I am signing this bill to restore unemployment benefits, stop evictions, provide rental assistance, add money for PPP, return our airline workers back to work, add substantially more money for vaccine distribution, and much more," Trump said.

The House on Monday will vote on a bill to boost direct payments to $2,000, but even if it passes, many expect the proposal will not be successful in the GOP-controlled Senate. 

The stimulus package is expected to cushion the hit to the economic recovery from restrictions across the country amid efforts to contain the spread of the virus.

"And the reason I’m concerned and my colleagues in public health are concerned also is that we very well might see a post-seasonal, in the sense of Christmas, New Year’s, surge, and, as I have described it, as a surge upon a surge, because, if you look at the slope, the incline of cases that we have experienced as we have gone into the late fall and soon-to-be-early winter, it is really quite troubling," top U.S. infectious disease expert Dr Anthorny Fauci said Sunday on CNN.

As well as stimulus efforts, progress on further Covid-19 vaccines boosted sentiment on risk assets.

AstraZeneca (NASDAQ:AZN)'s vaccine is expected to get the regulatory nod from UK health authorities later this week, while Novavax 's (NASDAQ:NVAX) vaccine candidate got late-stage clinical trials underway in the U.S. and Mexico.

Travel-related sectors were boosted by the positive stimulus and vaccine news, with airlines, cruise lines, and casino stocks higher.

American Airlines (NASDAQ:AAL) rose 2%, Las Vegas Sands (NYSE:LVS) was up 3%, and Norwegian Cruise Line (NYSE:NCLH) climbed 4%

Tech also powered ahead as the Fab 5 stocks continued to rack up gains.

Amazon.com (NASDAQ:AMZN), Facebook (NASDAQ:FB), Google-parent Alphabet (NASDAQ:GOOGL), Microsoft  (NASDAQ:MSFT) and Apple (NASDAQ:AAPL) traded higher,  with the latter up 3%.

Chinese tech giant Alibaba (NYSE:BABA) cut losses to end in the green after increasing its share buyback program to $10 billion from $6 billion amid an ongoing probe from Chinese regulators into the company over allegation of monopolistic practices.   

In other news, JPMorgan (NYSE:JPM) is set acquire CxLoyalty's credit card rewards and travel business to take advantage of an expected rebound in travel demand next year, CNBC reported.

Dow Notches Record High as $900B Stimulus Package Stokes Recovery Hopes
 

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Comments (15)
Bac Phan Van
Bac Phan Van Dec 28, 2020 9:04PM ET
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What is "add money for PPP"?
Jasper Yu
Jasper Yu Dec 28, 2020 9:04PM ET
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Basically it's free money to business so that they can keep and pay employees and certain expenses...
Bac Phan Van
Bac Phan Van Dec 28, 2020 9:03PM ET
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What is "add money for PPP"?
James Bell
James Bell Dec 28, 2020 6:50PM ET
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recovery? how will we recover from the upcoming housing crisis? so Biden is going to pay everyone's back rent and mortgage? good luck getting out of this one folks.
Ross Hemara
Ross Hemara Dec 28, 2020 6:50PM ET
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Its not joe bidens stimulus package its what Trump has ptoposed
Notvery Goodathis
Peteymcletey Dec 28, 2020 6:30PM ET
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Recovery... 2022 we'll be back to 2019 levels. And market is higher now...
Rul Buz
Rul Buz Dec 28, 2020 6:28PM ET
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Short the market after stimulus becuase the market will have no reason to go up but millions to go down....
New Jazenevd
New Jazenevd Dec 28, 2020 5:46PM ET
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Also, “house bill” now is pure demagoguery. The law is already in books, it is signed. You cannot change it at this point.
NAMBAKAM HARINDRANATH
NAMBAKAM HARINDRANATH Dec 28, 2020 5:27PM ET
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House will pass the bill , there is no other way.
David Bennett
David Bennett Dec 28, 2020 5:05PM ET
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I have never been a bear in the market, but it doesn't take a rocket scientist to know this market will fall to 10 year lows in 30 days.
Thibault Santy
Thibault Santy Dec 28, 2020 5:05PM ET
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??? Enlighten us why you think the dow will go from 30k to 10k, in 30 days?As apparently it’s so obvious?
Matt Kay
Matt Kay Dec 28, 2020 5:05PM ET
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I am a forever bear but 10 year lows in 30 days is.... well... not happening
Rajesh Kumar
Rajesh Kumar Dec 28, 2020 5:05PM ET
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if market goes from 30k to 10k, can we expect another $5k stimulus check and student loan written off
Ross Dre
Ross Dre Dec 28, 2020 5:05PM ET
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I liked the comment not because i have the brilliance to believe this but because a return to a free market is an exciting prospect. The only healthy, nonmanufactured move from here is down.
New Jazenevd
New Jazenevd Dec 28, 2020 4:51PM ET
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The whole noise, disguised as market “analysis”, whether Trump signs this, whether Trump signs that and so on, was just this... noise.
Gamer Turtle
GamerTurtle Dec 28, 2020 4:40PM ET
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slowly ***the 401K through inflation is the new wave or wealth distribution.
one time
One_Time Dec 28, 2020 4:22PM ET
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Imagine if we had sent more to those pakistani lady boys, we would be at 5k already. Smh next stimulus maybe.
Robert Dean
Robert Dean Dec 28, 2020 4:17PM ET
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Fed prints it when they feel they want lol 2% inflation rate keep coming
Matt Kay
Matt Kay Dec 28, 2020 4:13PM ET
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Printers are spinning up: https://www.federalreserve.gov/monetarypolicy/bst_recenttrends.htm
victor ndor
victor ndor Dec 28, 2020 4:13PM ET
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resend the link please
Nate McWhorter
Nate McWhorter Dec 28, 2020 4:06PM ET
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Bulls are bullish on the bullishness of other bulls. Its greed
Rajesh Kumar
Rajesh Kumar Dec 28, 2020 3:51PM ET
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How much money does the government have access to, for these kinds of national calamity. Is it $5 trillions or $10 trillions or even more. Of the total amount that the government can access, how much has already been used. will be have enough money for another round of stimulus if there is 3rd round of virus outbreak, or in case of war with Russia / China. Is any money left.?
Jeff Gordon
Jeff Gordon Dec 28, 2020 3:51PM ET
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We're 30 trillion dollars in debt. There's $0 now. lol
Conepyora Comppany
Conepyora Comppany Dec 28, 2020 3:51PM ET
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Its up to primary dealers...
Erski Gumby
SB20 Dec 28, 2020 3:51PM ET
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LOL
Stephen Corsaro
Stephen Corsaro Dec 28, 2020 3:51PM ET
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you completely misunderstand "money". US currency is fiat. Google it. It is debt. The more debt created the more wealth is created. Thus debt that the government creates ends it travels in the markets. That is why security values increase in direct correlation with debt issued. A ten dollar bill is an IOU. That's why we can no longer exchange it for gold as we could prior to the Nixon administration's changes. It also Why the FDR administration recalled all gold from the public during the depression. Your bank account balance is also an IOU. The securities you own are IOUs. Any real estate you own is taxed ..you rent it from the government. Any "stimulus" money will eventually end up in the security markets that are overwhelming owned by 651 families. That's just reality. Stock prices will go up until the debt is repaid. Both public and private. It doesn't take a master mind to understand this. Current ability to supply goods and services makes supply side deficits highly unlikely. so
 
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