US stocks edge higher despite stimulus stalemate, vaccine delays

Dimming prospects for a new stimulus package before the United States election continue to weigh on stocks.

Stalled stimulus talks and setbacks on COVID-19 vaccines and treatments continue to hamper sentiment on Wall Street [File: Mike Segar/Reuters]

The main stock indexes in the United States were holding to the plus side on Wednesday after partisan tensions between the White House and Democrats in Congress continued to impede the passage of a new round of coronavirus relief aid, and after another setback on the quest for a COVID-19 vaccine dragged markets lower on Tuesday.

In mid-morning trading in New York, the Dow Jones Industrial Average was up more than 72 points or a quarter of a percentage point at 28,752.30.

The S&P 500 – a gauge for the health of US retirement and college savings reports – was up 0.17 percent while the tech-heavy Nasdaq Composite Index was up 0.16 percent.

A compromise deal between the White House, Republicans and Democrats in Congress on another round of pandemic relief aid is proving elusive and the prospects for bipartisan deal being passed before the November 3 election are dimming.

With the political climate growing ever more acrimonious as election day nears, Senate Republicans also appear to be out of lockstep with Trump.

After pulling the plug on stimulus talks last week – only to do an about-face within hours and restart them – Trump tweeted on Tuesday: “STIMULUS! “Go big or go home!!!”

But Senate Majority Leader Mitch McConnell said on Tuesday that the Republican-led Senate would vote next week on a $500bn coronavirus aid bill, which Democrats already have rejected.

Investors, meanwhile, are warming up to the idea of a possible “blue wave” as Democratic presidential candidate Joe Biden maintains his lead in national polls.

Biden has promised to spend trillions on green energy infrastructure if he wins the election and to fight trade spats through established multilateral bodies like the World Trade Organization – which Wall Street believes could eliminate some of the uncertainty that has resulted from the Trump administration’s trade wars.

The AMC theatre is pictured during the outbreak of the coronavirus in Burbank, California, the United States [File: Mario Anzuoni/Reuters]

The coronavirus pandemic continues to cloud the outlook, as investors fret over the latest setbacks in the quests for a vaccine and effective treatments.

On Tuesday, Eli Lilly said it was pausing enrollment in its COVID-19 antibody treatment clinical trial due to safety concerns. The news followed in the wake of Johnson & Johnson’s announcement that it had paused clinical trials of its coronavirus vaccine candidate because a study participant developed an unexplained illness.

Quarterly Earnings

Shares of Goldman Sachs Group Inc opened higher on Tuesday, but slipped into negative territory by mid-morning trading in New York after the bank reported that its third-quarter profits increased 94 percent thanks to a stellar performance for its trading business.

Bank of America Corp shares were down 3.83 percent and Wells Fargo & Co shares were down 4.3 percent after reports of a slump in third-quarter profits.

Shares of Apple were up 0.77 percent after the company launched its next-generation iPhone 12 on Tuesday.

And shares of Concho Resources Inc surged 12.85 percent after Bloomberg News, citing people familiar with the matter, reported that the shale oil and gas producer is in talks to be acquired by rival ConocoPhillips.

Source: Al Jazeera