Stocks declined sharply Monday as Wall Street’s optimism over the rollout of coronavirus vaccines was dashed by a climb in infections and fears of tougher restrictions and lockdowns.
Also making Wall Street nervous were Tuesday’s runoff elections in Georgia which will define the balance of the Senate and the legislative agenda of President-elect Joe Biden.
The Dow Jones Industrial Average was down 511 points, or 1.67%, to 30,095, the S&P 500 fell 1.8% and the Nasdaq declined 1.83%. The Dow and S&P 500 had set intraday record highs soon after markets opened Monday.
Stocks closed higher Thursday, the last trading session of 2020, with the Dow and S&P 500 setting new records as a volatile year, brutally disrupted by the coronavirus pandemic, ended.
The blue-chip Dow rose 7.3% in 2020, the S&P 500 gained 16.3% – at its pandemic low in March the index had been down more than 30% – and the tech-heavy Nasdaq jumped 43.6%, its best annual performance since 2009.
Traders are “perhaps a bit over-eager” but believe vaccines will “provide the ultimate economic kick-start, offering a massive booster shot to corporate profits,” said Stephen Innes of Axi.
U.S. deaths from the coronavirus rose to more than 351,500, according to Johns Hopkins University, and infections in the country jumped to about 20.64 million. Globally, more than 85 million people have contracted the virus.
Meanwhile, the passage in late 2020 of a $2.3 trillion spending bill, which included nearly a trillion dollars for coronavirus relief, has underpinned domestic stocks ahead of the two key run-off elections in Georgia.
The importance of that vote, which has attracted nearly $500 million in ad spending and a record 3 million mail-in ballots, was underscored Sunday by the release of a telephone call in which outgoing President Donald Trump attempted to pressure Georgia Secretary of State Brad Raffensperger to “find” the votes necessary to overturn the results of November’s presidential election.
Tesla (TSLA) – Get Report was rising 2.9% Monday after the electric vehicle company announced over the weekend that it met its 2020 goal of producing at least half a million cars but narrowly missed its aggressive delivery target following a record year fueled by China demand for its Model 3 sedan.
Bitcoin, the world’s largest cryptocurrency, fell as much as 20% on Monday after topping $34,000 on Sunday. Bitcoin hit $30,000 for the first time in its history the day before.
Bitcoin crossed $20,000 for the first time on Dec. 16.