The Dow Jones Industrial Average led a broad rally as Senate Majority Leader Mitch McConnell moved to stall a proposal for bigger stimulus checks. Meanwhile Walt Disney (DIS) was the best-performing blue chip, while leading China stock Pinduoduo (PDD) continued to turn in strong gains.
Earlier this week, Democrats passed a bill in the House that would see stimulus payments increase to $2,000, a move proposed by President Donald Trump. But Republican Senate leader McConnell countered this by introducing a bill in the Senate that would increase the payments to $2,000, but also repeal a law that protects social media companies. It would also set up a commission to study election fraud.
Senate Minority Leader Chuck Schumer lashed out at his rival’s maneuver, claiming it could kill the prospect of bigger payments.
“Senator McConnell knows how to make $2,000 survival checks reality and he knows how to kill them,” the Democrat said in a statement. “Will Senate Republicans go along with Senator McConnell’s cynical gambit or will they push him to give a vote on the stand-alone (bill)?”
Meanwhile, Treasury Secretary Steven Mnuchin has said the already agreed $600 stimulus payments will start going out immediately.
Meantime, the Covid-19 pandemic continues to take its toll. In the U.S., confirmed total coronavirus cases passed the 20 million milestone. In addition, the death toll is sitting just shy of 350,000, according to Worldometer. Global cumulative coronavirus cases now sit near the 83 million mark, with more than 1.8 million deaths.
Beyond Dow Jones: Nasdaq, S&P 500 Also Rise
The Nasdaq was jousting with the Dow Jones to be the day’s best-performing major index. Nevertheless, its gain was still a lean 0.2%. Baidu (BIDU) was the star of the day, rising by 12%. It was well clear of other noteworthy performers such as Pinduoduo and Tesla.
U.S. Stock Market Today Overview
Last Update: 2:56 PM ET 12/30/2020
The S&P 500 was also in the green, though it was fading from its highs with a gain of less than 0.2%. Mining stock Freeport-McMoRan (FCX) was the biggest winner, posting a gain of more than 7%.
The stock got some airplay in Wednesday’s IBD Live show.
Small caps were outperforming the major indexes, with the Russell 2000 gaining more than 1%.
Volume was mixed compared with the same time on Tuesday. Trading fell more than 13% on the NYSE, and rose by more than 10% on the Nasdaq. CAN SLIM investors prefer volume to be higher on an up day.
The majority of sectors were in the green, with much more winners than losers. Energy and materials were the best-performing sectors.
The Vanguard Energy Index Fund (VDE) was up around 1.5%.
Growth stocks were doing even better than small caps. The Innovator IBD 50 ETF (FFTY) was up by around 1.7%. The best-performing stocks on the IBD 50 included Digital Turbine (APPS) and Futu (FUTU), with both gaining almost 9%.
Disney Stock Lifts Dow Jones
The Dow Jones Industrial Average was leading for most of the session, though it was fading to a gain of 0.3%.
Walt Disney stock was the best-performing Dow component, rising by more than 4%. It is now closing in on a 20% to 25% profit-taking zone from a consolidation pattern. The ideal entry point was 153.51.
China Stock Accrues More Gains
Leaderboard name Pinduoduo is continuing to make good gains. After a very strong Tuesday, gaining 15.5%, it was up almost 7% Wednesday.
Its upward climb came amid tight action, and has halted what looked like a base-forming phase. But that action came to a halt when PDD stock leapt to new highs in the week ended Dec. 11.
Shares have also rebounded sharply after a test of the 10-week moving average, which offered a follow-on buy point.
Pinduoduo operates an e-commerce platform in China that resembles a virtual bazaar. Buyers can even interact with one another as they explore a full spectrum of products.
Pinduoduo stock was featured on Wednesday’s edition of IBD Live.
Tesla Stock, Nio Accelerate
Newly minted S&P 500 member Tesla looked set to move higher for the fifth session in a row. It sits just off record highs after gaining more than 4%.
The IBD Leaderboard stock remains extended from a 466 proper buy point after breaking out of a cup-with-handle base. Tesla still has a best-possible IBD Composite Rating of 99. Tesla stock is up almost 725% so far in 2020.
Tesla was almost neck-and-neck with Chinese rival Nio, which also made a decent gain of more than 4%. It is aiming to make progress for the second day in a row and move further clear of its 50-day moving average. It remains well shy of its Nov. 24 high of 57.20.
Meanwhile, Tesla’s namesake rival Nikola (NKLA), which has been battered after a flurry of bad news, slipped 0.4%. The stock has plunged 83% from its 93.99 peak on June 9.
Please follow Michael Larkin on Twitter at @IBD_MLarkin for more on growth stocks and analysis.
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