Elusive stimulus and Brexit weighed on risk sentiment

  • The Dow Jones Industrial Average lost 105.07 points, or 0.35%.
  • The S&P500 dropped 29.43 points, or 0.79%.
  • The Nasdaq Composite fell 243.82 points, or 1.94%.

Wall Street was down in the dumps on Wednesday as US stocks were declining from record levels.

A lack of progress of US economic stimulus and Brexit talks have weighed on investor sentiment a drop in Facebook shares provided an additional weight.

The US covid relief package to help buttress the economy remains elusive while the COVID-19 pandemic spreads and related lockdowns are expected to anchor an economic recovery.

The US Senate Majority Leader Mitch McConnell stated that lawmakers are still looking for a path toward an agreement on COVID-19 aid, as the US House of Representatives prepared to vote on a one-week funding bill to provide more time for a deal.

Meanwhile, the Dow Jones Industrial Average fell 105.07 points, or 0.35%, to 30,068.81, the S&P500 lost 29.43 points, or 0.79%, to 3,672.82 and the Nasdaq Composite dropped 243.82 points, or 1.94%, to 12,338.95.

Prior to these performances, positive updates on the COVID-19 vaccine development along with hopes for a fresh fiscal stimulus package had sent the benchmarks to all-time highs. The S&P 500 was surpassing 3,700 points for the first time on Tuesday.

Brexit crunch time talks

Meanwhile, on the Brexit front, UK Prime Minister Johnson and EU President von der Leyen are meeting in Brussels and, if progress can be made, the talks will continue in coming days.

”Agreement between the two parties on the Northern Ireland protocol is a positive development and might help build trust, which is in short supply and overshadowing level playing field discussions,” analysts at ANZ bank explained.

”For the UK, EU recognition (in particular France) that UK coastal waters are sovereign is absolutely fundamental to agreeing a transition period for fishing quotas. But it is unlikely that the meeting will result in an agreement ahead of the EU Summit tomorrow. At best, an improvement in the mood is likely with the ultimate deadline for a deal being 31 December.” 

 

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