The S&P 500 fell slightly in volatile trading on Monday to start the holiday week as enthusiasm over a coronavirus stimulus deal was overwhelmed by worries over a viral new COVID strain in the U.K.
The Dow Jones Industrials fought their way into plus territory, gaining 37.4 points to 30,216.45, as the strength in Nike and bank shares supported the blue-chip benchmark.
The S&P 500 fell short of breakeven 14.49 points to 3,694.92
The NASDAQ skidded 13.12 points, though off its lows of the day, to finish at 12,742.52.
Dow-component Nike popped nearly 5% to hit a record high on the back of strong earnings. Bank stocks jumped in unison with JPMorgan collecting 3.8%, and Goldman up 6.1%, after the Federal Reserve announced it will allow the industry to resume share buybacks in the first quarter of 2021.
Now with a stimulus package agreed upon, investors may also be seeking to lock in profits after an unexpected banner year. With less than two trading weeks left in 2020, the S&P 500 is up 14.4% for the year, while the 30-stock Dow has risen 5.9%. The NASDAQ has rallied 42% this year as investors favored high-growth technology companies.
Travel-related stocks initially fell sharply on news of an infectious new coronavirus strain in the U.K., which triggered more severe lockdowns and travel restrictions across Europe. However, some believe the concerns over the new virus variant could be overblown.
Shares of airlines and cruise line operators closed well off their session lows. Norwegian finished the day 1.6% lower and Royal Caribbean dipped 0.7%. American Airlines fell 2.5% after sliding more than 5% earlier, while United Airlines dipped 1.5%. More than two-dozen countries from Italy to India to El Salvador have banned flights from the U.K. or travelers who have been in the country.
Tesla dropped more than 6% as it entered the S&P 500 with a 1.69% weighting in the index, the fifth largest. The stock fell to its session following a report that Apple is moving forward with its plan to produce electric vehicles.
Monday’s choppy trading came as lawmakers reached an agreement on a $900-billion relief package, which would provide direct payments and jobless aid to struggling Americans. The announcement came after negotiators resolved a key sticking point by rolling back the Federal Reserve’s emergency lending powers.
Treasury Secretary Steven Mnuchin told the media the stimulus money will go out as soon as next week.
Congress passed a one-day spending bill to avoid a government shutdown that would have started at 12:01 a.m. ET Monday. President Donald Trump signed the measure late Sunday evening, according to White House spokesman Judd Deere.
Lawmakers were to vote on the relief and funding bill on Monday.
The major averages hit record highs recently amid optimism toward fresh coronavirus stimulus as well as the vaccine rollout. Moderna is shipping its first batch of vaccine doses after receiving approval for emergence use from the U.S. Food and Drug Administration.
Meanwhile, the vaccines by Pfizer and BioNTech are being distributed to front-line health-care workers around the country.
Prices for the 10-Year Treasury gained ground, lowering yields to 0.93% from Friday’s 0.95%. Treasury prices and yields move in opposite directions.
Oil prices lost $1.31 to $47.79 U.S. a barrel.
Gold prices faltered $7.40 to $1,881.50.