US STOCKS-Wall Street hits record as fiscal aid bill signed

(For a Reuters live blog on U.S., UK and European stock
markets, click LIVE/ or type LIVE/ in a news window)
* Markets rise on recovery hopes
* Tesla up on report of India entry next year
* Airlines, cruise operators climb
* Dow up 0.73%, S&P 500 up 0.94%, Nasdaq up 0.89%

(Updates to mid-afternoon, changes byline)
By Chuck Mikolajczak
NEW YORK, Dec 28 (Reuters) - U.S. stocks rose on Monday,
with each of Wall Street's main indexes touching record levels
as President Donald Trump's signing of a long-awaited $2.3
trillion pandemic aid bill increased optimism for an economic
recovery.
In a sudden reversal late on Sunday, Trump backed down from
his threat to block the hard-fought bill, restoring unemployment
benefits to millions of Americans and averting a federal
government shutdown. "Stocks are riding the coattails of the additional stimulus
program and that is for good reason," said Terry Sandven, chief
equity strategist at U.S. Bank Wealth Management in Minneapolis,
Minnesota.
"You've still got monetary and fiscal stimulus that is in
motion and that clearly provides economic stability, medical
progress for COVID-19 continues to evolve and that will unfold
at a more accelerated rate now as you get into the new year and
importantly, the macro environment is favorable for stocks," he
said.
The Dow Jones Industrial Average .DJI rose 219.36 points,
or 0.73%, to 30,419.23, the S&P 500 .SPX gained 34.95 points,
or 0.94%, to 3,738.01 and the Nasdaq Composite .IXIC added
114.10 points, or 0.89%, to 12,918.84.
Stocks battered by coronavirus lockdowns, such as airlines
and cruise lines, advanced. The S&P 1500 airlines index
.SPCOMAIR added 1.5% as carriers are set to receive $15
billion in addition payroll assistance under the new government
aid.
Cruise operators Royal Caribbean Cruises Ltd RCL.N ,
Carnival Corp CCL.N and Norwegian Cruise Line Holdings Ltd
NCLH.N each rose by at least 4%
On a sector basis, gains were led by communication services
.SPLRCL , consumer discretionary .SPLRCD and tech .SPLRCT
as each posted gains of more than 1%.
After a sharp recovery from a coronavirus crash in March,
the S&P 500 is on track to rise more than 15% this year on the
back of a loose monetary policy, high liquidity and a COVID-19
vaccine program.
Despite the generally favorable conditions for equities,
worries over a resurgence in coronavirus cases, upcoming U.S.
Senate runoffs in Georgia and stretched valuations could become
headwinds. The forward price-to-earnings ratio of the S&P is
currently about 22.2, well above its long-term average of 15.3.

Trading volumes are expected to be thin in the final week of
the year that has historically been a seasonally strong period
for equities.
Democrats in the U.S. Congress on Monday will put to vote a
proposal for higher pandemic relief payments for Americans,
although it appears unlikely to gain traction in the
Republican-controlled Senate. Adding to a global appetite for risk, Britain and the
European Union clinched a lean post-Brexit trade deal on
Thursday, while a mass COVID-19 vaccination drive in Europe was
launched over the weekend. Tesla Inc TSLA.O advanced 0.90% after a report that the
electric-car maker will start operations in India early next
year. Lockheed Martin Corp LMT.N edged up 0.41% after the
fighter jet maker said it delivered 123 F-35 jets in 2020, near
the top end of its revised outlook. Advancing issues outnumbered declining ones on the NYSE by a
1.32-to-1 ratio; on Nasdaq, a 1.29-to-1 ratio favored advancers.
The S&P 500 posted 35 new 52-week highs and no new lows; the
Nasdaq Composite recorded 234 new highs and 13 new lows.