Stocks closed out 2020 at record highs.

The S&P 500 ended the year at an all-time closing high, securing a gain of just over 16% for the year, or 18% with reinvested dividends. This marked a back-to-back year of double-digit gains for the blue-chip index, after it advanced by nearly 29% in 2019.

The newest entrant to the S&P 500 was also the best performer in the index. Tesla (TSLA), added to the S&P 500 in mid-December, closed out 2020 with a jump of about 740%, followed by Etsy (ETSY) with a gain of 300%. Meanwhile Occidental Petroleum (OXY) and Carnival Corp (CCL) were the worst performers in the index, as each dropped by about 57%.

The Dow also reached a record closing high, and ended the year with an increase of about 7%.

Though the Nasdaq lagged during Thursday’s session, its year-to-date gains were the strongest of the three major indices. With Big Tech and software stocks among the most popular this year amid the COVID-19 pandemic, the Nasdaq ended the year with a jump of more than 40%. The information technology and Amazon-heavy (AMZN) consumer discretionary sectors were the biggest outperformers in the S&P 500, in another testament to the 2020’s banner year for tech.

Stocks closed out the year with strong returns, even given the lingering economic strain induced by the coronavirus pandemic. U.S. economic output remains below pre-virus levels even after a record third-quarter surge, and the labor market is still 9.8 million jobs short of its total before the pandemic hit in March. On Thursday, the Labor Department’s final weekly unemployment claims report for 2020 showed another 787,000 Americans filed for first-time jobless claims, for a sum well above the pre-pandemic weekly average of 200,000 new claims, but still the lowest level in a month.

But heading into 2021, a vaccine is roll-out under way and $900 billion in additional stimulus is set to be unleashed into the economy, offering hopes for a rebound in economic growth and corporate profitability.

“In the last couple quarters, the market probably got most of what it wanted to see,” Tim Courtney, chief investment officer for Exencial Wealth Advisors, told Yahoo Finance. “It got the vaccines with the high efficacy rates, it got very, very low interest rates, and so far low inflation moving into 2021. It’s got what looks like a divided Congress, although that’s still up in the air.”

“But moving into next year, it’s going to be how these things play out. Will the vaccine be distributed efficiently, effectively? Will consumer confidence rise to the point where we could get some of this deferred consumption in 2021, which is what the market wants to see? And will consumers be healthy enough, will these stimulus checks ... keep them above water long enough to have some kind of return to normalcy? The market seems to be priced for these things to work out relatively well.”

While the latest stimulus package will offer a lifeline to many businesses and individuals impacted by the pandemic, many have called for further relief to help bridge the gap for the most vulnerable populations until a longer-lasting economic reopening can take place. Though the House of Representatives voted to increase direct payments to consumers to $2,000, up from the $600 offered in the current virus relief bill, the Senate has so far suggested it will not advance the measure on its own.

Still, the combination of fiscal and monetary policy gave traders reason to be bullish this year, and that optimism may extend into the next, according to many strategists.

“I think that the zero interest rate phenomenon that we find ourselves in is covering over a lot of problems for the market. We do have the issue that there is no alternative,” Courtney added. “And when you have really no effective alternative to stocks, I think you are going to see that markets will shrug off bad news and use the good news to justify the current valuations. I think some level of that is justified when there truly is no alternative, no other place to go get a real return in liquid markets.”

Meager treasury yields have also pushed investors into other risk assets, and Bitcoin (BTC-USD) prices on Thursday surged to a fresh record high of more than $29,000, just over two weeks after breaching the $20,000 level for the first time ever.

—

4:06 p.m. ET: S&P 500 powers to a record closing high on the final day of 2020, ending the year with a 16% rise

Here were the main moves in markets as of 4:06 p.m. ET:

• S&P 500 (^GSPC): +24.03 (+0.64%) to 3,756.07

• Dow (^DJI): +196.92 (+0.65%) to 30,606.48

• Nasdaq (^IXIC): +18.28 (+0.14%) to 12,888.28

• Crude (CL=F): +$0.02 (+0.04%) to $48.42 a barrel

• Gold (GC=F): +$10.50 (+0.55%) to $1,903.90 per ounce

• 10-year Treasury (^TNX): -0.9 bps to yield 0.9170%

—

3:37 p.m. ET: Stay-at-home trade stocks were some of 2020’s biggest winners

Companies offering goods and services conducive to keeping people occupied while staying indoors working and entertaining themselves at home surged this year, and were some of 2020’s biggest stock winners.

Zoom Video Communications (ZM) – Yahoo Finance’s Company of the Year for 2020 – saw its stock surge nearly 400%, as its video conferencing service became nearly ubiquitous across workplaces, educational institutions and among individuals for keeping in touch with their loved ones. Home fitness company Peloton (PTON) saw shares surge more than 430%.

E-commerce companies also performed strongly, benefiting from the accelerated shift to online shopping as mobility restrictions were in place. Etsy (ETSY) shares jumped 300% this year, and Amazon’s (AMZN) stock rose 75%. Among the Big Tech FAANG names, Amazon’s rise was surpassed only by Apple’s (AAPL), as the iPhone-maker’s stock powered higher by 80% this year.

Also of note was the rise in shares of Moderna (MRNA), which ballooned 425% this year as the company rose from a little-known biotechnology name to become a leader in the race to develop a COVID-19 vaccine.

—

1:02 p.m. ET: Year-end rally suggests stocks will keep rising: LPL Financial

As 2020 comes to a close, traders are looking ahead to what 2021 may bring.

According to LPL Financial, history suggests stocks will rise further by year-end 2021, given the rally seen in the final months of this year. The S&P 500 has risen more than 14% between November and December.

“Turns out a 10% or more gain the final two months of the year has equaled a higher S&P 500 the following year every single time since World War II,” LPL Financial Chief Market Strategist Ryan Detrick said in a note Thursday. “In fact, January was also higher every single time as well, so maybe this strong rally to end the year is a clue for higher prices into next year.”

Still, this would not preclude the market from feeling a correction sometime over the course of the coming months, as many other strategists have suggested may occur given 2020’s sharp advances.

—

9:31 a.m. ET: Stocks open mixed in final session of 2020

Here were the main moves in markets, as of 9:31 a.m. ET:

• S&P 500 (^GSPC): 3,732.44, up 0.4 points or 0.01%

• Dow (^DJI): 30,401.59, down 7.97 points or 0.03%

• Nasdaq (^IXIC): 12,877.25, up 7.97 points or 0.06%

• Crude (CL=F): -$0.36 (-0.74%) to $48.04 a barrel

• Gold (GC=F): +$8.90 (+0.47%) to $1,902.30 per ounce

• 10-year Treasury (^TNX): unchanged, yielding 0.926%

—

8:30 a.m. ET: Jobless claims unexpectedly decline, but still hold well above pre-pandemic levels

New jobless claims broke below the 800,000 level for the first time this month, after holding above that level for the past three consecutive weeks.

Initial unemployment claims totaled 787,000, coming in much better than the 835,000 expected. The previous week’s new claims were revised to 806,000.

Still, weekly initial jobless claims remain high compared to the about 200,000 new claims filed on average each week before the pandemic.

Continuing claims, which measure the total number of individuals still receiving unemployment benefits, also unexpectedly fell. These totaled 5.219 million, coming in below the 5.370 million expected and revised 5.322 million during the prior week.

—

7:15 a.m. ET Thursday: Stock futures point to a higher open as overnight gains hold

Here were the main moves in markets, as of 7:15 a.m. ET:

• S&P 500 futures (ES=F): 3,726.75, up 2.5 points or 0.07%

• Dow futures (YM=F): 30,311.00, up 9 points or 0.03%

• Nasdaq futures (NQ=F): 12,860.00, up 18.5 points or 0.14%

• Crude (CL=F): -$0.48 (-0.99%) to $47.92 a barrel

• Gold (GC=F): +$4.00 (+0.21%) to $1,897.40 per ounce

• 10-year Treasury (^TNX): unchanged, yielding 0.926%

—

6:01 p.m. ET Wednesday: Stock futures tick up

Here were the main moves in markets as the overnight session kicked off Wednesday evening:

• S&P 500 futures (ES=F): 3,726.00, up 1.75 points or 0.05%

• Dow futures (YM=F): 30,334.00, up 32 points or 0.11%

• Nasdaq futures (NQ=F): 12,847.5, up 6 points or 0.05%

—

Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, LinkedIn, and reddit.

Find live stock market quotes and the latest business and finance news

For tutorials and information on investing and trading stocks, check out Cashay