Positive Market Outlook with Talks of a Stimulus Package
Over the past weekend, the Food and Drug Administration granted emergency authorization to Pfizer to start distributing its COVID-19 vaccine. The CDC Director has approved the vaccine, with immediate vaccination efforts targeting individuals aged 16 and older, specifically prioritizing healthcare workers and residents of assisted living facilities. Eventually, the vaccine will be available to the general public as distribution progresses.
Anticipation of a potential end to the pandemic in the United States has boosted market confidence. At the start of trading today, the Dow Jones saw a gain of 220 points, equivalent to 0.7%. The S&P 500 and Nasdaq also experienced slight increases at 0.6% and 0.7%, respectively. Notably, Boeing, one of the most valuable Dow components, saw a rise in value by 2.1%.
Last week, market concerns over stalled stimulus package discussions led to a downturn. However, reports suggest that a comprehensive plan may be approved by the end of the day. The proposed $908 billion package is now divided into two parts: $748 billion allocated for jobless benefits and small business aid, while the remaining amount would support direct state aid and include contentious liability protections.
Sandra Lindsay, an ICU nurse in New York, is among the first in the U.S. to receive a coronavirus vaccine. https://t.co/P9fDsZewim
— Breaking News (@BreakingNews) December 14, 2020
Raymond James’ institutional equity strategist, Tavis McCourt, commented on the ongoing political debate regarding the fiscal bill, emphasizing its crucial need for the population. The anticipated bill might lead to increased consumer spending as economies fully reopen, potentially enhancing overall market conditions despite the current economic slowdown due to local shutdowns.
McCourt also noted that while the economy is showing signs of slowing down, any impact on the equity market remains limited. He believes that unless significant changes occur in the vaccine distribution narrative, market pullbacks are likely to be restricted moving into the first quarter.
