US STOCKS-S&P edges down in choppy session as U.S. stimulus talks drag on
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By Sinéad Carew
Oct 21 (Reuters) - The S&P closed slightly lower on Wednesday after a volatile trading session as investors worried whether difficult negotiations in Washington would produce a deal for a fresh U.S. coronavirus stimulus package.
White House Chief of Staff Mark Meadows said that while there are a number of differences between the White House and Congressional Democrats, Republican President Donald Trump was "willing to lean into" working on an agreement.
Before starting afternoon talks with Treasury Secretary Steven Mnuchin, U.S. House Speaker Nancy Pelosi said there was still a chance for a deal despite resistance from Senate Republicans, though she acknowledged it might not pass until after the election.
"As long as she keeps dangling the carrot out there that there's still a chance that something could get done investors continue to remain optimistic," said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles.
"You would rather have more long exposure than have too much cash if an agreement is reached. That's a big if."
James said investors were holding out hope a deal could be reached on Thursday. "Everybody's going to be sitting on pins and needles waiting for the next headline between now and the end of tomorrow's trading day."
Unofficially, the Dow Jones Industrial Average fell 98.76 points, or 0.35%, to 28,210.03, the S&P 500 lost 7.77 points, or 0.23%, to 3,435.35 and the Nasdaq Composite dropped 31.80 points, or 0.28%, to 11,484.69.
Instead of plowing money into the market broadly, Michael O’Rourke, chief market strategist at JonesTrading in Stamford, Connecticut said investors picked stocks as they looked at third-quarter financial results.
Of the major industry sectors communications services was the biggest gainer for much of the session.
Shares surged in Snapchat messaging app owner Snap Inc after it beat user growth and revenue forecasts, as more people signed up to chat with friends and family during the COVID-19 pandemic.
The news helped boost the shares of other social media companies Facebook Inc and Twitter Inc and helped lift the communications services sector. Smaller social media firm Pinterest Inc also soared.
Dampening the mood however was Netflix Inc, which took a big tumble after it kicked off earnings for the market's high-flyers club. The video streaming service missed expectations for subscriber growth as competition increased and live sports returned to television.
Of the 84 S&P 500 firms that have reported third-quarter results, 85.7% have topped expectations for earnings, according to IBES Refinitiv data.
Investors also have their eyes on the upcoming elections. Trump and Democratic challenger Joe Biden will face off in their second and final debate on Thursday night.
Electric-car maker Tesla Inc was due to report quarterly results after the closing bell. (Additional reporting by Medha Singh and Shivani Kumaresan in Bengaluru; Editing by Shounak Dasgupta and David Gregorio)
