Wall Street’s main indexes were set to open near record levels on Monday as President Donald Trump’s signing of a long-awaited $2.3 trillion pandemic aid bill bolstered bets on an economic recovery, helping financial and energy stocks.
In a sudden reversal late on Sunday, Trump backed down from his threat to block the hard-fought bill, restoring unemployment benefits to millions of Americans and averted a federal government shutdown.
“Trump signing the COVID relief and government spending bill has gotten uncertainty out of the way, and the market right now is on autopilot – creeping its way higher into the new year,” said Sam Stovall, chief investment strategist at CFRA Research.
Trading volumes are expected to be slim in the final week of the year, with stock markets being shut on Friday for New Year holiday.
Airline shares were among the top gainers as the payroll aid is expected to provide some relief to the battered sector. Southwest Airlines, Delta Air lines, United Airlines and American Airlines rose between 1.5% and 2.8% in premarket trading.
Bank stocks, including those of Wells Fargo and Goldman Sachs, gained between 0.8% and 1.2%.
The rolling out of vaccines and a string of stimulus measures have put the S&P 500 on track to rise about 15% this year, with some of the biggest boost coming from technology heavyweights Apple Inc and Amazon.com Inc.
However, tech stocks lost some fizz in recent weeks as less-loved parts of the market such as energy, financials and small caps took center stage on hopes of an economic rebound. Investors are also assessing their bets on U.S. technology stocks for the coming year against the backdrop of pricey valuations and regulatory risks.
At 08:30 a.m. ET, S&P 500 E-minis were up 26.5 points, or 0.72%, Dow E-minis were up 156 points, or 0.51%, and Nasdaq 100 E-minis were up 104.25 points, or 0.82%.
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.
Fueling the global appetite for risk, Britain and European Union clinched a lean post-Brexit trade deal on Thursday, while the launch of a mass COVID-19 vaccination drive in Europe over the weekend added to the upbeat mood.
U.S.-listed shares of Alibaba Group fell 1.6%, extending Thursday’s loss of 13.34% after China launched an anti-trust probe into the company.
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