Wall Street ends lower but crude advances as Senate weighs expanded stimulus
By Stephen Culp NEW YORK (Reuters) - Wall Street lost ground on Tuesday, retreating from intraday highs, while oil prices gained ground as investors looked to Washington for signs that an enhanced stimulus package would pass a U.S. Senate vote. All three major U.S.
By Stephen Culp
NEW YORK (Reuters) - Wall Street lost ground on Tuesday, retreating from intraday highs, while oil prices gained ground as investors looked to Washington for signs that an enhanced stimulus package would pass a U.S. Senate vote.
All three major U.S. stock indexes oscillated, at one point following the MSCI World Stocks index to record intraday highs, but ended the session in negative territory as market participants balanced near-term challenges with longer-term hopes for economic recovery and a return to healthy demand.
Light trading volume in a holiday-shortened week can fuel market volatility.
"(It's) the kind of day where you don't have a full team on the bench, so it doesn't take much to move things around," said Stephen Massocca, senior vice president at Wedbush Securities in San Francisco. "It is easy to get things snowballing this entire week, so you have to be careful."
The U.S. House of Representatives voted on Monday to meet President Donald Trump's demand for $2,000 direct payments, an increase from originally approved $600, to Americans as part of the recently signed fiscal relief bill, sending the measure to the Republican-controlled Senate.
Senate Majority Leader Mitch McConnell blocked an effort to approve the direct payments by unanimous consent, but said the chamber would address the increased stimulus checks this week.
With upcoming U.S. Senate runoff elections in Georgia, the size of direct payment checks Americans receive could be a sensitive topic. The elections will determine which party controls the Senate.
"This probably the most political issue of the year because it could cost the Republicans the Senate, if voters feel they blocked it," said Peter Cardillo, chief market economist at Spartan Capital Securities in New York, adding "there will probably be some movement on it and that would be positive for the market."
Vaccine trials and distribution are gathering momentum around the world as global COVID-19 cases https://apac1.apps.cp.thomsonreuters.com/cms/?navid=1592404098 surpass 81 million and deaths approach 1.8 million. In the United States, there have been more than 19 million cumulative cases and nearly 335,000 deaths.
The Dow Jones Industrial Average fell 68.3 points, or 0.22%, to 30,335.67, the S&P 500 lost 8.32 points, or 0.22%, to 3,727.04 and the Nasdaq Composite dropped 49.20 points, or 0.38%, to 12,850.22.
European stocks extended their year-end rally to close at a 10-month high in anticipation of fresh stimulus and as the European Union vaccination program got under way.
The pan-European STOXX 600 index rose 0.76% and MSCI's gauge of stocks across the globe gained 0.33%.
Emerging market stocks rose 1.12%. MSCI's broadest index of Asia-Pacific shares outside Japan closed 1.07% higher, while Japan's Nikkei rose 2.66%.
Crude prices advanced on hopes that pandemic aid could boost demand and spur economic growth.
U.S. crude rose 0.8% to settle at $48 per barrel and Brent settled at $51.09 per barrel, up 0.45% on the day.
U.S. Treasury yields were essentially flat in thin trading, as investors awaited the Senate's response to the $2,000 stimulus check approved by the House.
Benchmark 10-year notes last rose 1/32 in price to yield 0.9314%, from 0.933% late on Monday.
The 30-year bond last rose 1/32 in price to yield 1.6683%, from 1.669% late on Monday.
The dollar dipped to a two-year low against the euro and riskier currencies gained ground on the Brexit trade deal and prospects of increased fiscal aid.
The dollar index fell 0.37%, with the euro up 0.29% to $1.225.
The Japanese yen strengthened 0.26% versus the greenback at 103.54 per dollar, while Sterling was last trading at $1.3501, up 0.39% on the day.
Gold prices advanced as the dropping dollar bolstered the safe-haven metal's appeal ahead of the Senate's vote on the higher stimulus payments.
Spot gold added 0.4% to $1,878.51 an ounce.
(Reporting by Stephen Culp; additonal reporting by Simon Jessup; editing by Jonathan Oatis)
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By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States
BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.