Stocks End Mixed as Senate Passes Bill to Avert Government Shutdown

Stocks post a losing week as hopes for a stimulus accord fade.
Author:
Publish date:

Stocks finished mixed Friday as the Senate passed a one-week spending bill that would avert a partial government shutdown and as the Food and Drug Administration was expected to expedite approval of a coronavirus vaccine.

The bill, already approved by the House, was sent to President Donald Trump for his signature. It averted a shutdown that would have started at midnight.

Equities reported a losing week as hopes on Wall Street faded that lawmakers in Washington would reach a stimulus agreement as coronavirus cases surged across the U.S.

Having little positive effect on sentiment was news that the coronavirus vaccine developed by Pfizer  (PFE) - Get Report and BioNTech  (BNTX) - Get Report -- the first Covid-19 vaccine in the U.S. -- received the backing of an advisory committee of the Food and Drug Administration. 

The FDA said Friday it would "rapidly work toward finalization and issuance of an emergency use authorization" and said it has notified the Centers for Disease Control and Prevention and Operation Warp Speed "so they can execute their plans for timely vaccine distribution."

New York Gov. Andrew Cuomo said indoor-dining restrictions in the nation's largest city would be reinstated indefinitely on Monday as infections and hospitalizations in the city and the state surge.

The Dow Jones Industrial Average finished up 47 points, or 0.16%, to 30,046, the S&P 500 declined 0.13% and the Nasdaq ended down 0.23%. 

For the week, the Dow fell 0.6%, the S&P 500 gave up nearly 1% and the Nasdaq slipped 0.7%.

Tesla  (TSLA) - Get Report declined 2.7% on Friday following a downgrade from analysts at Jefferies.

Walt Disney  (DIS) - Get Report finished up 14% Friday after the entertainment giant said it expects its streaming services -- Disney+, Hulu, and ESPN+ -- to have a combined 350 million subscribers in four years.

While Democrats and Republicans continue to negotiate over a relief bill of around $900 billion, disagreements over shielding companies from virus-related lawsuits have stalled the deal.

Senate Majority Leader Mitch McConnell has urged lawmakers to drop aid for state and local governments and liability protections, and to proceed with a smaller bill without either, according to Bloomberg.

But House Speaker Nancy Pelosi has continued to reject that proposal, instead preferring to pause liability lawsuits in exchange for $160 billion in state aid floated by a bipartisan group of lawmakers.

"While the market seems to be already pricing in stimulus expectations, I fear reality might disappoint overly optimistic investors who are betting on another multitrillion-dollar stimulus package," said Nancy Davis, portfolio manager of the Quadratic Interest Rate Volatility and Inflation Hedge exchange-traded fund  (IVOL) - Get Report.

Pfizer traded 1.5% lower Friday after the Covid-19 vaccine it developed with Germany's BioNTech won approval Thursday from an FDA advisory panel, with the full FDA likely to act quickly to roll out the vaccine.

The committee’s recommendation to approve emergency-use authorization for the vaccine passed 17 to 4, with one abstention. 

The FDA had been expected to grant the authorization for emergency use on Saturday, The New York Times reported, citing people familiar with the agency’s planning. But the paper later reported that the FDA was aiming to move up the announcement to Friday evening after Trump criticized the agency for moving too slowly.

Distribution in the U.S. could begin within 24 hours, according to Health and Human Services Secretary Alex Azar. First priority for the vaccine will go to health-care workers and nursing home residents.

The approval from the FDA panel comes as the U.S. has seen 292,611 people die from Covid-19, according to Johns Hopkins University. Infections in the country have risen to 15.65 million.