Stocks ended lower Friday, finishing a losing week, as President-elect Joe Biden unveiled a $1.9 trillion covid-19 relief package, banks fell after kicking off earnings season, and U.S. retail sales were worse than expected.
The Dow Jones Industrial Average fell 177 points, or 0.57%, to 30,814, the S&P 500 declined 0.72% and the Nasdaq was down 0.87%.
For the week, the Dow declined 0.9%, the S&P 500 fell 1.5% and the Nasdaq lost 1.5%.
Biden’s "American Rescue Plan" includes $1,400 checks for individuals, on top of $600 provided in the most recent relief bill.
Other elements of the plan include extending supplemental unemployment payments and a moratorium on evictions and foreclosures through September.
The president-elect's plan also provides funds for vaccine deployment to help fight the coronavirus pandemic, which as of Thursday had killed nearly 389,000 Americans.
The size of the aid package, as well as the potential for tax increases, has many on Wall Street concerned that Biden may not win support in Congress for his proposals.
“To some extent, most of this optimism had been priced in, but the huge figures had also invited some contemplation as to whether the necessary bipartisan support will materialize for this huge sum,” said Jingyi Pan, a Singapore-based market strategist for IG.
Shares of JPMorgan Chase (JPM) - Get JP Morgan Chase & Co. Report, Wells Fargo (WFC) - Get Wells Fargo & Company Report and Citigroup (C) - Get Citigroup Inc. Report fell sharply Friday after the big banks reported fourth-quarter earnings.
Wells Fargo fell the most, ending down 7.8% in trading Friday.
JPMorgan Chase, the biggest U.S. bank, posted much stronger-than-expected fourth-quarter earnings as investment banking profit surged and the company booked a benefit of $1.9 billion from its earlier credit provisions.
“While positive vaccine and stimulus developments contributed to these reserve releases this quarter, our credit reserves of over $30 billion continue to reflect significant near-term economic uncertainty and will allow us to withstand an economic environment far worse than the current base forecasts by most economists,” Chief Executive Jamie Dimon said in a statement.
Exxon Mobil (XOM) - Get Exxon Mobil Corporation Report fell 4.8% after The Wall Street Journal reported the oil giant was under investigation by the Securities and Exchange Commission as the agency responded to an employee’s whistleblower complaint.
U.S. retail sales weakened for a second consecutive month in December, the Commerce Department said Friday, as consumers pulled back on holiday spending amid expanded pandemic job losses.