U.S. stock markets closed at a new high on Thursday after lawmakers agreed to a new financial lifeline for businesses and individuals who could help the economy through the deadliest phase of the coronavirus pandemic.

The Dow Jones Industrial Average, the S&P 500 and the Nasdaq Composite all reached daily highlights and new end records during the trading session. Nine of the top eleven sectors of S&P 500 underperformed, with some of the largest profits in the healthcare, technology and real estate sectors.

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The S&P 500 thus rose by 21.31 points, or 0.6%, to 3,722.48, after a peak of 3,735.12. The Dow Jones Industrial Average rose 148.83 points, or 0.5%, to 30303.37, while the Nasdaq Composite added 106.56 points, or 0.8%, to 12764.75.

Analysts have expressed optimism that lawmakers will continue to push for an agreement to provide about $900 billion in support for coronaviruses. Negotiations on a package including a new round of direct payments to households continued on Thursday. After months of deadlock, the burgeoning agreement meant a breakthrough at a critical moment in the pandemic. The distribution of vaccines continues, but hospital admissions are at record levels.

The legislators had initially hoped to adopt the aid law and a large package of public spending before the current government funding ends shortly after midnight Saturday. But congressional leaders are now considering a temporary spending measure to give themselves more time to complete negotiations on the bill and extend the approval period.

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Volunteers load cars with turkeys and other food on Saturdays for laid-off workers in Orlando.

Photo:

Paul Hennessy/NurPhoto/Zuma Press

Investors generally believe that a new dose of stimulus is needed to get the economy through the winter and that widespread vaccination could bring the virus under control by 2021. The increase in business seems to have affected consumer confidence and weighed on retail sales. There are also new restrictions on doing business in some states.

Incentives are important, says Mary Nicola, Portfolio Manager at PineBridge Investments.

Thursday’s employment data reinforces the signs that the economy has peaked. In the week ending 12 December, the number of unemployed rose from 23,000 to 885,000. Economists expected a slight decline.

Any incentive is good right now, especially when you’re going through a difficult time, Nicola added. This gives you an extra incentive to rest.

Stocks of several companies increased sharply on Thursday after better quarterly results were published. Lennar gained $5.66, or 7.6%, to $79.95 after the construction company said first-quarter deliveries and orders would be stronger than analysts had expected.

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Help jumped $2.97, or 17%, to $20.08 after the drugstore chain beat analyst forecasts, while Accenture climbed $17.02, or 6.9%, to $264.47 after the consulting firm also beat Wall Street forecasts.

Legislators working on the Coronavirus bill face two challenges: Supporting national and local authorities and protecting accountability. Gerald F. Seib of the WSJ explained why these issues are important and what a compromise might look like. Photo: Drew Angerer/Getty Images (originally published December 9, 2020)

The international markets advanced on Thursday. The Stoxx Europe 600 grew by 0.3% across the region, driven by cyclical commodity producers, retailers and media companies. The Shanghai Composite Index rose by 1.1%. The Japanese Nikkei 225 rose by 0.2%.

On the bond side, the yield on 10-year Treasury paper went from 0.920% Wednesday to 0.929%. The Dollar has extended its recent decline. The WSJ Dollar Index fell 0.3% after reaching its lowest level since April 2018 on Wednesday.

The decline came after the Federal Reserve stated that its asset purchases of $120 billion per month would continue until significant progress was made on employment and inflation targets.

The policy update underlines that the central bank will continue to support the financial markets for some time, according to analysts and investors.

Email Joe Wallace at [email protected] and Michael Wursthorn at [email protected]

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