Wall Street’s main indexes eased from record highs in volatile trading on Tuesday as investors worried the U.S. Senate may not quickly pass the additional pandemic aid checks to help jobless Americans.
Senate Majority Leader Mitch McConnell said the chamber would address this week President Donald Trump’s call for an increase in stimulus payments from $600 to $2,000. Final passage of the proposal would require 60 votes and the backing of a dozen Republicans.
McConnell’s comment comes a day after Democratic-led House of Representatives approved the move to bump up direct payments.
“Most investors thought they had a clear idea of the government stimulus package, but it’s really up in the air to how it is going to be handled,” said Rick Meckler, partner, Cherry Lane Investments, a family investment office in New Vernon, New Jersey.
Wall Street’s three main indexes opened at new highs for a second straight session after Trump signed a $2.3 trillion fiscal bill that restored jobless benefits and averted a federal government shutdown.
Meanwhile, more than 2 million Americans have been inoculated, helping investors looked past a surge in infections that topped 19 million, with California, a major U.S. virus hot spot, likely to extend strict stay-at-home orders.
Unprecedented monetary as well as fiscal stimulus and positive vaccine data have helped the S&P 500 bounce back from a virus-led crash in March.
The benchmark index is set for its best fourth-quarter performance since 2003 as investors returned to economically-sensitive stocks from the so called ‘stay-at-home’ plays on hopes of a recovery.
After a recent rally on hopes of full economic reopening, eight of the major S&P 500 sectors fell with energy and industrials declining the most.
At 12:42 p.m. ET, the Dow Jones Industrial Average fell 72.84 points, or 0.24%, to 30,331.13, the S&P 500 lost 4.58 points, or 0.12%, to 3,730.78 and the Nasdaq Composite lost 59.27 points, or 0.46%, to 12,840.16.
The CBOE volatility index ticked higher after hitting a three-week low with trading volumes expected to be light in the holiday-shortened week.
Intel Corp jumped 5.3% after Reuters reported activist hedge fund Third Point LLC is pushing the chipmaker to explore strategic options, including whether it should remain an integrated device manufacturer. [nL1N2J9139]
Shares of planemaker Boeing Co added 1.6% as its 737 MAX plane resumed passenger flights in the United States for the first time after a 20-month safety ban was lifted last month.
Snapchat owner Snap Inc gained 7% after Goldman Sachs raised its price target on the stock on upbeat revenue growth prospects.
Declining issues outnumbered advancers by a 1.4-to-1 ratio on the NYSE and by a 2.7-to-1 ratio on the Nasdaq.
The S&P 500 posted 21 new 52-week highs and no new low, while the Nasdaq recorded 171 new highs and 24 new lows.
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