Wall Street has surged, with its main indexes closing near record levels, helped by optimism about a potential government stimulus and bets on more signals of easy monetary policy from the Federal Reserve.
Apple Inc was the top boost to all three US benchmarks, surging to its highest since September after a report said it plans to increase iPhone production by 30 per cent in the first half of 2021.
The Russell 2000 index of smaller companies surged to a record high.
Some investors viewed the recent spike in coronavirus infections and deaths and a grim November employment report as an impetus for a quick deal on a COVID-19 stimulus bill, with economically sensitive sectors such as consumer discretionary, materials leading gains.
The S&P 500 utilities index logged its strongest one-day gain since early November.
“They have lagged and you could see a little bit of rotation of people looking for yield,” said 6 Meridian Chief Investment Officer Andrew Mies, referring to utilities stocks.
Broad gains across the stock market were a healthy sign, Mies added.
US House Speaker Nancy Pelosi invited congressional leaders to meet on Tuesday to finalise a massive government spending deal and reach an agreement on a new package of coronavirus relief.
The Fed is also expected to signal low-interest rates for the foreseeable future in its two-day meeting starting on Tuesday.
The recent coronavirus vaccine roll-out is expected to improve the central bank’s 2021 outlook.
Unofficially, the Dow Jones Industrial Average rose 1.14 per cent to end at 30,201.68 points, while the S&P 500 gained 1.30 per cent to 3,694.77.
The Nasdaq Composite climbed 1.25 per cent to 12,595.06.
Supported by Apple, the S&P 500 technology sector index also rallied.
The sector has outperformed the broader market during the pandemic and is up over 35 per cent year to date, with investors viewing it as resilient to virus-related disruptions.
“The market likes to go to tech when it is afraid the economy may stall because of a rise in infections and shutdowns,” said Christopher Grisanti at MAI Capital Management.
Increased liquidity and ultra-low lending rates have sent investors flocking to stocks for during the COVID pandemic, while recent optimism over a vaccine pushed the S&P 500 to a series of record highs last week.
Eli Lilly and Co jumped after the company said it would buy Prevail Therapeutics Inc in a deal potentially valued at $US1 billion ($A1.3 billion) to expand its presence in the lucrative field of gene therapy.
Prevail’s shares surged close to 80 per cent.
Moderna Inc’s shares tumbled, even after the US Food and Drug Administration raised no new concerns over data on the drugmaker’s COVID-19 vaccine.