Stocks ended lower Tuesday amid a bevy of earnings reports and as Wall Street turns its attention to the Federal Reserve and efforts by U.S. lawmakers to pass the next coronavirus relief package.
The Dow Jones Industrial Average ended off 205 points, or 0.77%, at 26,379, the S&P 500 lost 0.7% and the Nasdaq declined 1.3%.
The Fed begins a two-day meeting Tuesday and investors expect the central bank to remain supportive of the economy as the U.S. economy struggles in its fight against the coronavirus pandemic.
At its meeting in June, the Federal Reserve kept interest rates steady and said it expects to hold the target range for the federal funds rate unchanged at 0% to 0.25% at least through 2022 or until the economy “had weathered recent events.”
“The reality is that the Fed has proclaimed that they are going to keep the printing presses rolling, they will print money and it has created this all-you-can eat buffet,” Terri Spath, Sierra Investment Management’s chief investment officer, told Bloomberg. “The bottom may be in for the year, but we do expect volatility in the future.”
On Tuesday, the Federal Reserve extended several emergency loan programs until the end of 2020. They were set to expire Sept. 30.
Gold, often perceived as a safe-haven asset, hit an intraday record of $1,974.70 an ounce earlier Tuesday. It settled at a record $1,944.60 an ounce, up 0.7%.
Meanwhile, Senate Republicans unveiled their $1 trillion virus aid package that would include cutting the current federal $600 weekly unemployment supplement down to $200 a week, and send $1,200 payments to most Americans. Democrats offered a $3.5 trillion plan that includes money for schools and local governments.
Consumer confidence declined in July amid doubts about a recovery for the U.S. economy. The index fell to 92.6 in July from a revised 98.3 in June, according to the Conference Board.
Pfizer (PFE) - Get Report posted stronger-than-expected second-quarter earnings and lifted its full-year profit guidance as branded drug sales offset the slowdown linked to the global coronavirus pandemic.
The drug making giant also announced Monday that it and its partner, Germany's BioNTech (BNTX) - Get Report had started a later-stage trial for their coronavirus vaccine candidate. The stock rose 3.96%.
3M's (MMM) - Get Report second-quarter earnings were weaker than expected and the company declined to reinstate full-year profit guidance as coronavirus shutdowns of businesses around the world hammered industrial sales. Shares declined 4.8%.