The S&P 500 fell on Friday, on pace for its first weekly loss in three weeks, as the outlook for additional fiscal stimulus remained uncertain.
The broader market index pulled back by 0.3%, and the Nasdaq Composite dipped 0.5%. The Dow Jones Industrial Average eked out a 37-point gain, however, as Disney and Microsoft gave the benchmark a boost.
For the week, the Dow and S&P 500 were down 0.6% and 1.1%, respectively. The Nasdaq has lost 1% week to date.
Friday’s decline came as negotiations over a coronavirus relief deal dragged on. Lawmakers seek to pass a bill before lifelines expire at the end of 2020, but disagreements over state and local stimulus, unemployment assistance and stimulus checks still exist.
Senate Majority Leader Mitch McConnell‘s staff informed congressional leadership offices that Senate Republicans likely would not support a $908 billion bipartisan proposal, according to NBC News. Earlier on Thursday, House Speaker Nancy Pelosi said that bipartisan negotiations were leading to “great progress.”
“The inability for Washington to enact more fiscal aid is a complete failure. We know where the differences lie,” wrote Gregory Faranello, head of U.S. rates trading at AmeriVet Securities. “Right now this is about cashflow and saving businesses and helping keep individuals afloat while we rollout the vaccine.”
The House has passed a one-week federal spending extension to avoid a shutdown through Dec. 18 to buy more time to reach a stimulus agreement.
Share of companies hardest hit by the pandemic recession fell on Friday. Carnival, United Airlines and Gap each fell more than 3%. Hyatt Hotels dropped more than 1%. Tesla shares fell 3.8% after a surprise downgrade by Jefferies.
Without fresh stimulus, millions of Americans could lose unemployment benefits in the new year. Meanwhile, weekly jobless claims jumped last week to 853,000, the highest total since Sept. 19, as new lockdown restrictions weighed on businesses amid rising coronavirus cases.
Sentiment was downbeat on Friday even as a key Food and Drug Administration advisory panel recommended the approval of Pfizer and BioNTech’s coronavirus vaccine for emergency use. The recommendation marked the last step before the FDA gives the final approval to broadly distribute the first doses throughout the U.S.
Bucking the negative trend was Disney. On Thursday, the company said its Disney+ service has 86.8 million subscribers and expects have between 230 million to 260 million subscribers by 2024. The stock rose 13.7%.
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