Stocks

Wall Street Hits Record Highs at Open on Stimulus Bill Signing; Dow up 170 Pts

© Reuters.

By Geoffrey Smith 

Investing.com — U.S. stock markets opened at record highs on Monday after President Donald Trump dropped his objections to signing into law the $900 billion stimulus package passed last week by Congress.

By 9:35 AM ET (1435 GMT), the was up 170 points, or 0.6%, at 30,370 points. The and the were both up 0.7%. 

There remains a slim possibility of the stimulus package being augmented over the next two days. The Democrat-controlled House of Representatives is set to vote on a proposal by Trump to increase the direct payments to households foreseen in the bill to $2,000 from $600. The Republican-led Senate, which reconvenes on Tuesday, has so far not endorsed anything higher than what’s in the bill. However, some Senators may wish to avoid any negative publicity from blocking the suggestion with barely a week to go until runoffs for two key Senate seats in Georgia, which will determine control of the upper chamber for the next two years.

Airline stocks were among the most visible winners from Trump’s change of heart, which unlocked some $15 billion in extra aid for the industry: American Airlines (NASDAQ:) stock rose 3.5%, while Delta Air Lines (NYSE:) stock, Southwest Airlines (NYSE:) stock and United Airlines (NASDAQ:) stock all rose by between 1.4% and 1.6%.

Alibaba (NYSE:) ADRs shrugged off the latest piece of negative news surrounding the company, rising 0.5% despite the central bank of China ordering big changes to the operating model of its financial services arm Ant Group. Alibaba’s ADRs had fallen by over 13% on Thursday after Chinese antitrust regulators launched an investigation into suspected abusive practices by the e-commerce giant.  The People’s Bank of China on Monday published a statement on its website that paved the way to curtailing its operations in wealth management and consumer credit and “rectify” irregularities in its insurance arm – the three divisions that make most of Ant Group’s profit.

Elsewhere, the market shrugged off news from FedEx (NYSE:) that it had completed the acquisition of ShopRunner, a move that should bolster its own Internet presence. FedEx stock was down by 0.4%. 

A more conspicuous underperformer was Zoom Video (NASDAQ:), which fell over 4% to its lowest since early September against a backdrop of expectations that the rollout of vaccines will allow a return to normal life in 2021 and slow, if not reverse, the trend to virtual communications.  Another stock losing its froth was Moderna (NASDAQ:), which fell 3.7% to a one-month low.  While Moderna’s vaccine has now been approved for emergency use in the U.S., its commercial potential may yet be limited by the availability of cheaper alternatives worldwide. U.K. regulators are expected to approve the AstraZeneca/Oxford University vaccine this week, while a vaccine developed by China’s Sinopharm is also progressing through the regulatory approvals process worldwide.

 

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