By Yasin Ebrahim
Investing.com – The Dow struggled for direction Wednesday as House Speaker Nancy Pelosi said she was optimistic over a stimulus package, though flagged Senate GOP leader Mitch McConnell as a likely stumbling block to getting a deal over the line before the U.S. election.
The Dow Jones Industrial Average fell 0.35%, or 98 points. The S&P 500 slipped 0.24%, while the Nasdaq Composite fell 0.28%.
Pelosi said she is optimistic "over the prospect" of an agreement, though admitted that President Donald Trump would likely have to sway McConnell to back the deal, Politico reported, citing Pelosi's comments on Sirius XM (NASDAQ:SIRI).
McConnell previously expressed little desire to back a large stimulus package, preferring to roll out a $500 billion skinny relief bill. The Senate GOP, however, failed to garner enough votes to advance Wednesday as Democrats voted against the legislation.
The latest remarks on a deal come amid mostly positive news on the vaccine front.
Johnson & Johnson (NYSE:JNJ) and AstraZeneca (NYSE:AZN) are set to resume their U.S. trials this week, Bloomberg News reported. AstraZeneca did, however, report that a volunteer in its Covid-19 vaccine trial in Brazil had died. Brazilian health authorities will allow the trial to continue as the volunteer was not part of the cohort that received the vaccine, according to media reports.
The downside in the broader market was kept in check by a jump in communication services as social media stocks followed Snap Inc (NYSE:SNAP) higher.
Snap surged 28% after the social media company reported a surprise quarterly profit, led by a jump in user growth. The better-than-expected performance prompted Wedbush Securities to suggest that growth is likely to continue into Q4.
While Snap did not provide guidance, management did note that "revenue growth between 47 – 50% appears attainable, and the implied revenue figure of roughly $825 – 841 million is well above our prior estimate of $710 million and the prior consensus figure of $728 million," Wedbush said.
"Management also expects total DAUs of approximately 257 million, vs. our prior estimate of 255 million and prior consensus of 250 million," Wedbush added and raised its price target on the stock to $34.50 from $25.
Snap's bullish results pointed to signs of robust ad spending and triggered a surge in Twitter (NYSE:TWTR), Pinterest (NYSE:PINS) and Facebook (NASDAQ:FB).
Elsewhere on the earnings front, Netflix (NASDAQ:NFLX) fell 7% after third-quarter profit and subscriber growth fell short of estimates as pull-forward demand seen earlier in the year faded.
Texas Instruments (NASDAQ:TXN), meanwhile, fell more than 3%, despite reporting quarterly results that topped Wall Street estimates.
Energy was among the biggest losers intraday, paced by a fall in oil prices as data showing a draw in U.S. weekly inventories was overshadowed by ongoing fears about demand weakness amid rising Covid-19 infections.