NEW YORK (Reuters) – US stocks fell in turmoil on Tuesday after hitting record highs as investors worried about the path to economic reopening and whether the Senate would authorize additional pandemic aid controls .
Modest gains in early operations led the stock to an intraday record, but the advance evaporated after U.S. Senate Majority Leader Mitch McConnell blocked immediate consideration of the measure calling for a increase in stimulus payments from $ 600 to $ 2,000. Final approval of the proposal would require 60 votes and the support of a dozen Republicans.
McConnell said the chamber will address the increase in payments this week along with limits on large technology companies and electoral integrity.
McConnell’s comment comes a day after the Democratic-led House of Representatives approved the decision to bolster direct payments.
“Majority leader McConnell’s move not to endorse the $ 2,000 disbursements turned the equity markets from green to red around noon,” said Joseph Sroka, NovaPoint’s chief investment officer in Atlanta.
“The plan that was originally signed is being drawn up. The question of whether the larger individual checks are passed is up for debate.”
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 fall 49.20 points, or 0.38%, to 12,850.22.
Volumes are expected to be light during the reduced holiday week, which could lead to increased volatility. The S&P 500 has risen 15.4% so far this year, with only two trading days in 2020.
Wall Street’s top three indexes opened at new highs for a second straight session after Trump signed a $ 2.3 trillion tax bill that would restore jobless benefits and prevent the federal government from closing.
More than 2 million Americans have been inoculated, which has helped investors overcome the rise in infections that exceeded 19 million, with California, one of the most important points of the American virus, which can spread strict home stay orders.
But a sharp drop in small-cap stocks could mark concern around rising infections causing a slower-than-expected reopening, according to Stephen Massocca, senior vice president of Wedbush Securities in San Francisco. The Russell 2000 small-cap index fell 1.85% on the day, the largest one-day decline in a month.
Unprecedented monetary and fiscal stimulus measures, along with positive vaccine developments, have helped the S&P 500 recover from a shock caused by the virus in March.
The benchmark index rose more than 10% during the quarter, as investors came to economically sensitive stocks since the so-called “stay at home” in hopes of a recovery.
Intel Corp. jumped 4.93% after Reuters reported that activist hedge fund Third Point LLC is pushing the chip maker to explore strategic options, including whether it should remain an integrated device maker. [nL1N2J9139]
After rising to 2.6%, Boeing shares returned previous gains to close 0.07% as their 737 MAX resumed passenger flights to the United States for the first time since withdraw the 20-month security ban last month.
Snapchat owner Snap Snap rose 6.15% after Goldman Sachs raised its price target on stocks with optimistic revenue growth prospects.
The volume of US stock markets was 9.46 billion shares, compared to the average of 11.14 billion during the full session of the last 20 trading days.
Declining problems outperformed NYSE advances by a ratio of 1.70 to 1; on the Nasdaq, a ratio of 2.57 to 1 favored declines.
The S&P 500 recorded 21 new highs of 52 weeks and no new lows; the Nasdaq Composite recorded 83 new highs and 27 new lows.
Additional reports by Stephen Culp; Edited by David Gregorio