Stocks rose on Tuesday, building on the previous session’s strong gains, as lawmakers try to make inroads on a new coronavirus stimulus package.
The Dow Jones Industrial Average traded 126 points higher, or 0.5%. The S&P 500 climbed 0.2% while the Nasdaq Composite was flat. Both the Dow and S&P 500 were on pace to post three-day winning streaks.
Apple rose 0.6% and UnitedHealth gained 1.5%. The energy and real estate sectors rose more than 1% each to lead the S&P 500 higher.
Airline stocks experienced broad gains as well. United and Delta Air Lines both advanced more than 2%. American jumped 5.1% and JetBlue gained 3.1%.
Tuesday’s moves came as lawmakers struggle to make inroads on a new coronavirus stimulus package. House Speaker Nancy Pelosi said she, Senate Minority Leader Chuck Schumer and White House chief of staff Mark Meadows held “productive” discussions on Monday, but added there are several issues still outstanding.
“We are moving down the track,” Pelosi said, but “still have our differences.”
Both sides have indicated they agree on another $1,200 stimulus check, but remain deadlocked on additional unemployment assistance.
“In our opinion, Congress will muster the fortitude to deliver near-term stimulus support,” said Darrell Cronk, president of Wells Fargo Investment Management, in a note. “However, a greater challenge comes in 2021 when this year’s extraordinary fiscal stimulus programs fade.”
Wall Street was coming off a strong session, with the Dow rallying more than 200 points on Monday. The S&P 500 also ended the session less than 3% below the intraday record set on Feb. 19.
Those gains came after Microsoft and Apple powered the S&P 500 tech sector to an all-time high, rising 5.6% and 2.5%, respectively. Tech has been by far the best-performing sector this year, rising more than 23% in that time period.
“Tech stocks have captured considerable attention for their gaudy, relative total return performance, but what is less appreciated is how ‘consistent’ they have been,” Jim Paulsen, chief investment strategist at The Leuthold Group, in a note to clients. Paulsen pointed out the S&P 500 has outpaced the broader market 57% of the time in 2020.
“What valuation is warranted by a sector whose business grows faster for reasons that are less dependent on overall economic conditions, and whose members generate remarkable excess returns with superior frequency, compared to any other sector in the stock market?”
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