Shares fell on Friday as President-elect Joe Biden unveiled a $ 1.9 trillion Covid-19 aid package, banks fell after the start of the earnings season and US retail sales were worse than expected.
The Dow Jones Industrial Average fell 359 points, or 1.16%, to 30,632, the S&P 500 fell 1.1%, and the Nasdaq fell 1.06%. Shares plummeted in the last trading hour on Thursday. The Dow and Nasdaq had set intraday all-time highs during the session.
Biden’s “American Rescue Plan” includes $ 1,400 checks for individuals, in addition to $ 600 provided for in the latest emergency bills. Other elements of the plan include the extension of supplementary unemployment benefits and a moratorium on evictions and forced sales through September.
The president-elect’s plan also provides funding for the deployment of vaccines to help combat the coronavirus pandemic that has killed nearly 389,000 Americans since Thursday.
The size of the aid package, as well as the potential for tax increases, has worried many on Wall Street that Biden may not receive support in Congress for his proposals.
“To some extent, most of this optimism was priced in, but the massive numbers also prompted reflection on whether the necessary bipartisan support will be realized for this massive amount,” said Jingyi Pan, a Singapore-based market strategist for IG. .
Shares of JPMorgan Chase (JPM) – Request report, Wells Fargo (WFC) – Request report and Citigroup (C.) – Request report collapsed on Friday after major banks reported fourth-quarter earnings.
JPMorgan Chase, the largest US bank, posted much stronger-than-expected earnings in the fourth quarter as investment banking profits soared and the company posted a $ 1.9 billion benefit from previous loan loss provisions.
“While positive vaccine and stimulus developments have contributed to this release of reserves this quarter, our credit reserves of more than $ 30 billion continue to reflect significant short-term economic uncertainty and we will be able to cope with an economic environment that is much worse. is the current basic predictions of most economists. , CEO Jamie Dimon said in a statement.
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US retail sales weakened for the second consecutive month in December, the Commerce Department said Friday, as consumers pulled back on holiday spending amid mounting job losses from a pandemic.