(Reuters) – Major Wall Street indices fell on Monday as investors halted after a strong rally that put the S&P 500 on track for its best November in history.
The top 11 sectors of the S&P 500 were all trading lower, with energy leading to losses, following lower crude prices. [O/R]
IHS Markit topped the gains of the benchmark S&P 500 after data giant S&P Global agreed to buy the financial information provider in a $ 44 billion deal, which will be the most major business acquisition of 2020.
Month-end portfolio rebalancing played into Monday’s weakness, analysts said, as investors take advantage of the gains after a solid month marked by progressing COVID-19 vaccine updates and hopes for a rapid economic rebound next year.
A rotation in sectors known to offer better returns out of a recession such as energy, industrials and financials resulted in gains of over 11% for the S&P 500 and put the Dow Jones on the on track for his biggest monthly gain since 1987.
“It’s a sale that is justified after such solid gains. We have a lot of macroeconomic news this week and the nonfarm payroll may not be too market-friendly, ”said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
After an explosion in infections and trade restrictions this month stalled the recovery of the US labor market, the focus will be on the Fed’s monthly jobs report and beige book, as well as a speech by Fed Chairman Jerome Powell before the Senate Banking Committee.
(Chart: S&P 500 ready for best November)
At 11:44 a.m. ET, the Dow Jones Industrial Average fell 398.95 points, or 1.31% to 29,510.22 and the S&P 500 lost 33.92 points, or 0.93% to 3,604.57 . The Nasdaq Composite lost 79.00 points, or 0.66% to 12,125.13 after hitting a record early in the session.
U.S. Health Secretary Alex Azar said on Monday that the first two vaccines against the novel coronavirus could be available to Americans before Christmas.
Moderna has unveiled plans to seek emergency clearance in the United States and Europe for its COVID-19 vaccine after full results from an advanced stage study showed it to be 94.1% effective, increasing its actions by 16%.
“Until the vaccination starts, I don’t know if news on the same company is going to make a difference,” said Robert Pavlik, senior portfolio manager, Dakota Wealth, New York.
Macy’s Inc and Kohl’s Corp slipped 2.5% to 5% as masked shoppers showed up in smaller numbers at major U.S. retailers on Black Friday as early online deals and concerns about a spike in cases COVID-19 have dampened enthusiasm for shopping malls.
Nikola Corp sank 23% as the company and General Motors announced a reworked deal on a fuel cell partnership that eliminates a stake in the Detroit automaker’s startup and plans to build its electric pickup truck.
Falling issues outnumbered advanced issues by a 3 to 1 ratio on the NYSE and Nasdaq, a 0.5 to 1 ratio aided the declines.
The S&P 500 posted eight new 52-week highs and no new lows; the Nasdaq Composite recorded 243 new highs and six new lows.
Reporting by Shriya Ramakrishnan and Medha Singh in Bengaluru; Editing by Saumyadeb Chakrabarty and Arun Koyyur