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Wall Street closes lower as stimulus deadline nears without deal

Stock MarketsOct 19, 2020 04:45PM ET
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© Reuters. FILE PHOTO: A street sign, Wall Street, is seen outside New York Stock Exchange (NYSE) in New York City, New York

By Sinéad Carew

NEW YORK (Reuters) - Wall Street's main indexes closed lower on Monday as Washington lawmakers still appeared to struggle to reach an agreement on coronavirus stimulus ahead of a Tuesday deadline that would make a relief package possible ahead of the Nov. 3 elections.

House Speaker Nancy Pelosi said Sunday that in order to push through an agreement before the election, it would have to be settled on by Tuesday.

Pelosi and Treasury secretary Steve Mnuchin "continued to narrow their differences" in conversations on Monday and Pelosi was hopeful that by the end of Tuesday there will be "clarity" on whether coronavirus stimulus is possible before Nov. 3 election, according to a spokesperson for Pelosi.

Investors were also worried about rising coronavirus cases in parts of the United States and about whether U.S. President Donald Trump might end up contesting the election results.

"The lack of news on stimulus is worrisome compounded by worsening virus trends and uncertainty ahead of the elections," said Mona Mahajan, U.S. Investment Strategist, Allianz (DE:ALVG) Global Investors, New York.

Last week, the White House proposed a $1.8 trillion stimulus package that Pelosi rejected because it fell short of her demand for $2.2 trillion in aid.

"There's a decent case that regardless of who wins if stimulus doesn't happen before the election it'll happen afterward," said Mahajan but she added, "with (virus) cases rising again stimulus will be important."

As Wisconsin battled one of the worst coronavirus surges in the United States, a judge on Monday reinstated restrictions. In New Mexico, the governor warned that the state's healthcare resources might not be sufficient if cases keep rising at the current pace.

The number of new COVID-19 cases in the United States last week rose 13% to more than 393,000, approaching levels last seen during a summer peak, according to a Reuters analysis.

The Dow Jones Industrial Average fell 410.89 points, or 1.44%, to 28,195.42, the S&P 500 lost 56.89 points, or 1.63%, to 3,426.92 and the Nasdaq Composite dropped 192.67 points, or 1.65%, to 11,478.88.

All 11 major S&P industry sectors closed lower, with energy , down 2%, leading the percentage declines followed by the communication services index, down 1.9%. Only the defensive utilities sector, down 0.9%, finished with a decline of less than 1%.

High flyers stocks Apple Inc (NASDAQ:AAPL), Microsoft Corp (NASDAQ:MSFT) and Amazon.com (NASDAQ:AMZN) all fell more than 2% and created the biggest drags on the S&P 500.

Wall Street's fear gauge closed higher for a sixth straight session and finished above 29 for the first time since Oct. 6 as U.S. election campaigns kicked into high gear.

Nearly 30 million Americans have cast early ballots, shattering records as voters adjust to the coronavirus pandemic, including in Florida, battleground state that on Monday opened polls to early voting.

President Donald Trump and his Democratic challenger Joe Biden will debate for a final time on Thursday.

The election is "weighing on investor sentiment a bit and maybe there's incremental concern there will be a contested election," according to Mahajan citing poll stabilization and betting odds reflecting higher expectations for a Trump win.

The Dow Jones Transport Average closed down 1% after reversing course late in the afternoon as hopes dimmed for stimulus deal during the session.

Still it outperformed the broader market as the U.S. Transportation Security Administration said it screened more than 1 million airline passengers on Sunday for the first time since mid-March.

After the financial sector set a mixed tone for the start of the third-quarter earnings season last week, investors will look to results from about 91 S&P 500 companies this week.

International Business Machines (NYSE:IBM) Corp was down 1% in choppy after-the-bell trading when it reported results.

ConocoPhillips (NYSE:COP) shares fell 3.2% after it agreed to buy U.S. shale oil producer Concho Resources (NYSE:CXO) Inc for $9.7 billion as the energy sector continued to consolidate.

Declining issues outnumbered advancing ones on the NYSE by a 2.67-to-1 ratio; on Nasdaq, a 2.30-to-1 ratio favored decliners.

The S&P 500 posted 25 new 52-week highs and 1 new lows; the Nasdaq Composite recorded 101 new highs and 29 new lows.

On U.S. exchanges, 8.698 billion shares changed hands compared with the 9.213 billion average for the last 20 sessions.

Wall Street closes lower as stimulus deadline nears without deal
 

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Comments (22)
John Raymond
John Raymond Oct 19, 2020 5:15PM ET
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pelosi and hunter/Joe biden gonna cost the Dems the wh and electio
Thom Miller
Thom Miller Oct 19, 2020 4:31PM ET
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There was actually a time not too many years ago, Boys and Girls, when instead of stimulus checks, 0% interest rates, and the Fed’s non-stop printing of money, the US stock markets improved because of hard work, sweat, risk-taking, and Yankee ingenuity within corporate America. As you can see from the markets’ performances today, those days are long gone. The naive folks running Wall Street today, coupled with the many uneducated investors who populate this board, have turned the once strong and growing US free-enterprise system into a parody of its former self. And if you don’t believe me, just look at all the “thumbs down” votes this post will get. They will come from the very people who no longer possess the attributes that once drove this country to financial greatness.
The Man
The Man Oct 19, 2020 2:48PM ET
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Early voting this year does not mean democrats voting for Dems. Lots of republicans voting early.
Attila Bakk
Attila Bakk Oct 19, 2020 1:56PM ET
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The market is falling because larger than expected early voting means increased risk of higher corp taxes and more regulations - catch up
Niva Spin
Niva Spin Oct 19, 2020 1:56PM ET
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So your saying that early voting means Biden?
Attila Bakk
Attila Bakk Oct 19, 2020 1:56PM ET
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Niva Spin Yes higher number of voters is favorable to Democrats
James Gomez
James Gomez Oct 19, 2020 1:55PM ET
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How many times are you going to release the same ******article.
Tricky Dick
TrickyDick Oct 19, 2020 1:53PM ET
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What do they do, buy the articles from the day old bin to save money?
fu billie
fu billie Oct 19, 2020 1:47PM ET
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Well aside from useless or outdated info, the only thing they can talk about is stimulus. I wish my job is this easy so i don’t need to rely on stock market lol
Pwr Strk
Pwr Strk Oct 19, 2020 1:37PM ET
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lol, Reuters is up in smoke
Ben Ramirez
Ben Ramirez Oct 19, 2020 1:35PM ET
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It's dropping.  What you talking about , Willis?
Pwr Strk
Pwr Strk Oct 19, 2020 1:34PM ET
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all his higher says Reuters... they've been smoking a lot themselves
רועי לוין
רועי לוין Oct 19, 2020 1:19PM ET
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The stock market is about make a currection mini crash over the next 3months I have doubt about that at least 25%
Frederick Chotsky
Chotsky Oct 19, 2020 12:54PM ET
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Who writes this drivel? The headline says that markets move on hopes, then they proceed to list all the major advancers and decliners, none of which have anything to do with stimulus.
Attila Bakk
Attila Bakk Oct 19, 2020 12:42PM ET
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Wall Street falls as hopes for a timely stimulus deal fade
Attila Bakk
Attila Bakk Oct 19, 2020 12:39PM ET
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Stimulus hopes move quick lol
Randy Randy
randy00 Oct 19, 2020 12:28PM ET
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Think I'll go back to Yahoo Finance. These guys are way too slow with the news.
Gamer Paper
Gamer Paper Oct 19, 2020 11:49AM ET
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Investing: dow rises upDow: -100 points
Harry Dent
Harry Dent Oct 19, 2020 11:38AM ET
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Hear that ten thousand time, hope, hope, hope, NO hope, BANG! Grenade explosion 💥😹
Space Lord
Space Lord Oct 19, 2020 11:38AM ET
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This is how it goes, head explode
Space Lord
Space Lord Oct 19, 2020 11:38AM ET
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🤯
ce diaza
ce diaza Oct 19, 2020 11:33AM ET
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look again
Luis Bustamante
Luis Bustamante Oct 19, 2020 11:15AM ET
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All this is really sad and tragic
Llewellyn Kruger
Llewellyn Kruger Oct 19, 2020 9:39AM ET
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I would be impressed if they could get a stimulus package out again this year.
Robert Alex
Robert Alex Oct 19, 2020 9:33AM ET
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What are we at now? The 8th or 9th rally on "hopes of a stimulus"? This isn't happening. Enjoy the pump but be wary as it hits ATH.
Troy Coureton
Troy Coureton Oct 19, 2020 9:07AM ET
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When did hope become an investment strategy lol
Steffen vdm
Steffen vdm Oct 19, 2020 9:07AM ET
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When greed took over common sense
 
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