NEW YORK – Wall Street stocks fell yesterday to conclude a volatile week as markets weighed worries about rising coronavirus cases and a surprise US government move to end some emergency lending programmes.
The Dow Jones Industrial Average ended down 0.8% at 29,263.48.
The broad-based S&P 500 dropped 0.7% at 3,557.54, while the tech-rich Nasdaq Composite Index declined 0.4% to 11,854.97.
US pharma giant Pfizer and its German partner, BioNTech, yesterday said they have applied for emergency use authorisation for their Covid-19 vaccine, which could come next month.
The announcement comes as US virus caseloads continue to rise, with an average of 167,400 infections per day this week, and states impose fresh restrictions to slow the outbreak.
Some analysts questioned a decision by Treasury Secretary Steven Mnuchin to phase out a series of Federal Reserve programmes enacted in the spring to support the corporate credit market, municipal lending, and small and medium businesses.
Mnuchin said he is following congressional intent in phasing out at year-end the Fed programmes, intended to help the US financial system weather the shock of the pandemic.
He said the funds unused by the central bank should be repurposed to other pandemic relief efforts.
But, the Fed criticised the move in a rare public break with the Treasury, and congressional Democrats accused Mnuchin of trying to sabotage the incoming Joe Biden administration.
Ending the programmes poses a “risk” to the economy, said a note from Oxford Economics.
“The emergency lending facilities have been little used, but their existence has been key in ensuring a credible safeguard against financial market stress.
“With the Covid-19 crisis worsening and activity slowing in the absence of fiscal aid, the decision to curtail the Fed’s firepower could unsettle markets and exacerbate economic stress.” – AFP, November 21, 2020
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