Wall Street falls on stimulus stall, Facebook weighs

NEW YORK (Reuters) – U.S. stocks retreated on Wednesday from record levels as investors grew discouraged over the halting progress of economic stimulus talks, while a drop in Facebook shares provided an additional drag.

FILE PHOTO: The front facade of the New York Stock Exchange (NYSE) is seen in New York, U.S., November 24, 2020. REUTERS/Brendan McDermid

Investors are banking on a long-awaited relief package to help buttress an economy that has been battered from the COVID-19 pandemic and related lockdowns that has led to millions of layoffs and overwhelmed the healthcare system.

U.S. Senate Majority Leader Mitch McConnell said lawmakers were still looking for a path toward an agreement on COVID-19 aid, as the U.S. House of Representatives prepared to vote on a one-week funding bill to provide more time for a deal.

“There is a lot of talk, they say they are making progress and then they say they are so far apart, it is frustrating,” said Tim Ghriskey, Chief Investment Strategist at Inverness Counsel in New York, New York.

“The other thing is we’ve had this meteoric rise without any real pullback so at some point we are going to see a pullback, you need some digestion, certainly,” he added.

The Dow Jones Industrial Average fell 149.29 points, or 0.49%, to 30,024.59, the S&P 500 lost 34.12 points, or 0.92%, to 3,668.13 and the Nasdaq Composite dropped 241.61 points, or 1.92%, to 12,341.16.

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, down 1.91% after the U.S. Federal Trade Commission and a big coalition of states sued the social media company on Wednesday, saying it broke antitrust law.

With overall valuations now at extremely high levels, some investors worry stocks could be more vulnerable to any bad news such as unexpected setbacks in the roll-out of coronavirus vaccines or delays in stimulus.

DoorDash Inc opened at $182 after pricing at $102 per share in its debut on Wednesday after the food delivery startup raised $3.37 billion in one of the biggest U.S. stock market launches so far in 2020.

Home improvement chain Lowe’s Cos Inc jumped 5.80% after announcing a new $15 billion share repurchase plan.

Drugmaker Eli Lilly advanced 4.99% after flagging positive data for its experimental drug from a late-stage diabetes clinical trial.

Declining issues outnumbered advancing ones on the NYSE by a 1.33-to-1 ratio; on Nasdaq, a 2.06-to-1 ratio favored decliners.

The S&P 500 posted 38 new 52-week highs and no new lows; the Nasdaq Composite recorded 223 new highs and 12 new lows.

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