US stocks have closed lower, retreating from record levels as investors grow discouraged over the halting progress of economic stimulus talks, while a drop in Facebook shares provided an additional drag.
Investors are banking on a long-awaited relief package to help buttress an economy battered by COVID-19 and related lockdowns that have led to millions of lay-offs and overwhelmed the healthcare system.
Senate Majority Leader Mitch McConnell said on Wednesday Congress was still looking for a path toward agreement on COVID-19 aid, as the House of Representatives prepared to vote on a temporary bill to provide more time for a deal.
“We have been in a significant tug-of-war between vaccine news and virus news, and the vaccine news has won,” said Art Hogan at National Securities in New York.
“The tie-breaker in that tug of war has certainly been the potential for stimulus getting out of this Congress before they head home for the holiday,” he added.
Unofficially, the Dow Jones Industrial Average fell 90.88 points, or 0.3 per cent, to 30,083, the S&P 500 lost 26.95 points, or 0.73 per cent, to 3,675.3 and the Nasdaq Composite dropped 237.68 points, or 1.89 per cent, to 12,345.10.
Positive updates on the COVID-19 vaccine development along with hopes for a fresh fiscal stimulus package have helped fuel a rise in Wall Street’s main indexes to all-time highs, with the S&P 500 surpassing 3,700 points for the first time on Tuesday.
Facebook shares extended declines late in the session after the US Federal Trade Commission and nearly every US state sued the social media company, saying it broke antitrust law and should be broken up.
The news weighed on other mega cap names such as Alphabet and sent the NYSE FANG+ ETF down about 2 per cent.
With overall valuations now at extremely high levels, some investors worry stocks could be more vulnerable to bad news such as unexpected setbacks in the roll-out of coronavirus vaccines or stimulus delays.
Two allergic reactions were reported on the first day of the rollout of the Pfizer COVID-19 vaccine, the head of Britain’s medicine regulator said on Wednesday.
DoorDash Inc opened at $US182 after pricing at $US102 per share in its debut on Wednesday after the food delivery startup raised $US3.37 billion ($A4.52 billion) in one of the biggest US stock market launches in 2020.
Home improvement chain Lowe’s Cos jumped after announcing a new $US15 billion share repurchase plan.
Drugmaker Eli Lilly climbed after flagging positive data from a late-stage clinical trial for its experimental drug designed to treat type 2 diabetes.