admin The US stock market closed on a record high on Monday following the President’s signature on the $900 billion stimulus package. The proposed package will include $600 stimulus checks as well as extended unemployment benefits and more funding for the Paycheck Protection Program.
The Coveted Bill
The $900 billion round of fiscal stimulus was welcomed by investors in the US after President Donald Trump signed the stimulus package on Sunday. The President signed the package after previously having expressed views of blocking this bipartisan Covid-19 Aid Bill. The package is essential as it will allow millions of Americans to continue receiving unemployment benefits and prevent a Federal Government shutdown.
Hani Redha, a multiasset portfolio manager at PineBridge Investments stated, “Economically speaking, it is a major support to bridge over this difficult winter period. The market is going to still be in a constructive mood.” Tim Ghriskey, Chief Investment Strategist at Inverness Council New York asserted, “It’s a positive tone to the U.S. market and part of that is the signing of stimulus package by Trump, which appeared to be in doubt but is finally been accomplished.” Democrats in the U.S. Congress on Monday will put to vote a proposal for higher pandemic relief payments for Americans, although it appears unlikely to gain traction in the Republican-controlled Senate.
Stock Rate Changes
The Dow Jones Industrial Average added 204.10 points, or 0.7%, to 30403.97. The S&P 500 advanced 32.30 points, or 0.9%, to 3735.36 and the Nasdaq Composite gained 94.69 points, or 0.7%, to 12899.42. All three indexes set new closing highs.
The S&P 1500 airlines index gained as carriers are set to receive $15 billion in addition payroll assistance under the new government aid. Travel stocks were the main gainers when the market closed on Monday. American Airlines will receive $15 billion in aid to help bring back furlough workers. The Norwegian Cruise line gained 3.9% while Carnival cruise line gained 4.2%. Conversely, technology stocks took a setback. Despite Monday’s moves, shares of companies focused on e-commerce, online communications and at-home entertainment have been among the best-performing stocks in the market this year, a testament to how consumer behavior has changed due to pandemic-related lockdowns.
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