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Dow rises more than 200 points, hits record high as Wall Street kicks off last week of 2020

 Stocks traded higher on Monday in advance of the very last trading week of 2020 and as President Donald Trump suddenly signed an economic relief bill.

The Dow Jones Industrial Average jumped 207 points, or maybe 0.7 %. The S&P 500 climbed 0.7 %, and the Nasdaq Composite rose 0.6 %. All three major indexes hit record highs at the open.

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 many days after Trump suggested he would veto the legislation, demanding $2,000 immediate payments to Americans, instead of $600.

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 5 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 moderate and longer term view for stocks will be good, Essaye added.

Apple led the Dow higher, rising 2.5 %. Tech & 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 quiet holiday week where the major averages had been flat. The S&P 500 fell 0.2 % last week as several investors got the chips off into the year end. The 30-stock Dow eked out a 0.1 % gain for the same period.

Profit-taking might possibly ramp up in the final week of the year, which has so far seen surprisingly good returns. The S&P 500 has gained 15.4 % year to date, while the Dow has climbed 6.4 %. The Nasdaq has soared 43.2 % this year as investors favored high-growth technology names during the continued Covid 19 pandemic.

Dr. Anthony Fauci warned on Sunday that the country could see a surge in new Covid-19 infections following Christmas along with New Year’s celebrations. Two vaccines by Pfizer and Moderna have begun the distribution process this month. So much more than one million individuals in the U.S. have been vaccinated.

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