S&P 500, Dow dip on concerns over rising COVID-19 infections

By Shivani Kumaresan and Medha Singh (Reuters) - The S&P 500 and the Dow slipped on Friday with a surge in coronavirus cases threatening to derail a fragile economic recovery, even as plans were announced for ending several of the Federal Reserve's economic support programs. The Nasdaq edged 0.2% higher, boosted by a rise in shares of stay-at-home darlings Zoom Video Communications Inc and Amazon.com Inc. U.S

Reuters November 21, 2020 00:05:34 IST
S&P 500, Dow dip on concerns over rising COVID-19 infections

SP 500 Dow dip on concerns over rising COVID19 infections

By Shivani Kumaresan and Medha Singh

(Reuters) - The S&P 500 and the Dow slipped on Friday with a surge in coronavirus cases threatening to derail a fragile economic recovery, even as plans were announced for ending several of the Federal Reserve's economic support programs.

The Nasdaq edged 0.2% higher, boosted by a rise in shares of stay-at-home darlings Zoom Video Communications Inc and Amazon.com Inc.

U.S. Treasury Secretary Steven Mnuchin on Friday defended his decision to end several of the Fed's pandemic lending programs on Dec. 31, saying Congress should use the money to help small U.S. companies with grants instead.

The decision to end the programs, which were deemed essential by the central bank, comes as data showed a rise in jobless claims last week as new restrictions to control spiraling COVID-19 infections likely led to a fresh wave of layoffs.

"From a psychological standpoint it (expiry of certain Fed loan programs) could make people a little nervous," said Mike Zigmont, head of trading and research at Harvest Volatility Management.

"But the facility that is being terminated hasn't been utilized, so the fact that it's going away in December is not going to have a direct impact on anything."

Meanwhile, California and Ohio imposed nightly curfews on Thursday, with new hospitalizations jumping nearly 50% in the past two weeks in the United States.

The S&P 500 and the Dow were set for their first weekly losses in three weeks, as investors juggled between growing optimism over an effective coronavirus vaccine and near-term economic damage from the surging infections.

Hopes of a fiscal stimulus package were revived after U.S. Senate Democratic leader Chuck Schumer and Republican Majority Leader Mitch McConnell decided to resume relief talks on Thursday.

"There is a very dangerous race occurring, which is how fast can vaccinations start versus how fast infections are spreading in the country," said Mike Zigmont, head of trading and research at Harvest Volatility Management.

Major banks have upgraded their stock market forecasts for 2021 following recent promising data from COVID-19 vaccine trials.

At 11:34 a.m. ET the Dow Jones Industrial Average fell 85.64 points, or 0.29%, to 29,397.59, the S&P 500 fell 4.74 points, or 0.13%, to 3,577.13 and the Nasdaq Composite gained 17.92 points, or 0.15%, to 11,922.64.

All major S&P sectors slipped, barring utilities and healthcare.

Microchip Technology Inc jumped 5% after the chipmaker's quarterly profit and revenue came in above estimates. The Philadelphia SE semiconductor index gained 0.7%.

Pfizer Inc rose 1.2% as the company said it has applied to U.S. health regulators for emergency use authorization of its COVID-19 vaccine.

Apparel and home fashion retailer Ross Stores Inc gained 1% after its quarterly sales topped expectations.

Declining issues matched advancing ones on the NYSE, and on the Nasdaq a 0.7-to-1 ratio favored decliners.

The S&P 500 posted 14 new 52-week highs and no new low, while the Nasdaq Composite recorded 132 new highs and eight new lows.

(Reporting by Shivani Kumaresan and Medha Singh in Bengaluru; Editing by Shounak Dasgupta)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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