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

Published 12/28/2020, 01:26 PM
Updated 12/28/2020, 04:03 PM
© Reuters

© 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.

Latest comments

What is "add money for PPP"?
Basically it's free money to business so that they can keep and pay employees and certain expenses...
What is "add money for PPP"?
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.
Its not joe bidens stimulus package its what Trump has ptoposed
Recovery... 2022 we'll be back to 2019 levels. And market is higher now...
Short the market after stimulus becuase the market will have no reason to go up but millions to go down....
Also, “house bill” now is pure demagoguery. The law is already in books, it is signed. You cannot change it at this point.
House will pass the bill , there is no other way.
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.
??? Enlighten us why you think the dow will go from 30k to 10k, in 30 days?As apparently it’s so obvious?
I am a forever bear but 10 year lows in 30 days is.... well... not happening
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.
The whole noise, disguised as market “analysis”, whether Trump signs this, whether Trump signs that and so on, was just this... noise.
slowly ***the 401K through inflation is the new wave or wealth distribution.
Imagine if we had sent more to those pakistani lady boys, we would be at 5k already. Smh next stimulus maybe.
Fed prints it when they feel they want lol 2% inflation rate keep coming
Printers are spinning up: https://www.federalreserve.gov/monetarypolicy/bst_recenttrends.htm
resend the link please
Bulls are bullish on the bullishness of other bulls. Its greed
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