US stocks slide from records as wait continues for Congress

In this photo provided by the New York Stock Exchange, trader Ashley Lara, left, works on the floor during the Golden Falcon IPO, Friday, Dec. 18, 2020. U.S. stock indexes are slipping from their record levels Friday as the wait drags on to see if Congress can reach a deal to send more cash to struggling workers and businesses. (Colin Ziemer/New York Stock Exchange via AP) (Copyrighted)

BEIJING – U.S. stock indexes pulled back from their record levels Friday as the wait drags on to see if Congress can reach a deal to send more cash to struggling workers and businesses. The S&P 500 fell 0.4%, a day after it and other major indexes returned to record heights. Hope that Congress may be nearing a deal to offer more support for the economy helped the S&P 500 post a 1.3% gain this week. So has enthusiasm about vaccines for COVID-19, which investors hope will get the economy back on the road to normalcy next year.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.

U.S. stock indexes are pulling back from their record levels Friday as the wait drags on to see if Congress can reach a deal to send more cash to struggling workers and businesses.

The S&P 500 was 0.8% lower in afternoon trading, a day after it and other major indexes returned to record heights. Hope that Congress may be nearing a deal to offer more financial support for the economy has helped put the S&P 500 on track for a 0.8% gain this week, which would make up for most of the prior week’s loss. So has enthusiasm about vaccines for COVID-19, which investors hope will get the economy back on the road to normalcy next year.

Technology, health care and financial stocks were taking the brunt of the decline, with materials companies barely holding on to a gain. Small company stocks bucked the trend, continuing a rally that has the pushed the Russell 2000 small-caps index about 9% higher so far this month.

The selling came on a particularly busy day on Wall Street. Index funds were expected to snap up more than $80 billion worth of shares in Tesla as they moved to rebalance their holdings for the quarter ahead of the electric car maker's entry into the S&P 500 on Monday. In addition, Friday was also quadruple witching day, Wall Street-speak for the quarterly expiration of stock options and futures contracts, which forces traders to tie up loose ends in contracts they hold, leading to particularly heavy trading volume.

“This is an unusual day because we have Tesla entering the S&P and it’s quadruple witching day," said Andrew Slimmon, portfolio manager at Morgan Stanley Investment Management.

The Dow Jones Industrial Average was down 211 points, or 0.7%, at 30,091, as of 2:53 p.m. Eastern time, and the Nasdaq composite was 0.3% lower after giving up modest gains from earlier in the morning. The Russell 2000 was up 0.4%