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Stocks Pause After Dow's 30000 Milestone

11/25/2020 | 10:45am

By Will Horner

The Dow Jones Industrial retreated Wednesday, sliding back below 30000 after mixed economic data.

The blue-chip index fell around 154 points, or 0.5%, to 29891, a day after breaching the 30000 milestone for the first time. The S&P 500 lost 0.3% and the Nasdaq Composite swung between small gains and losses and was recently up less than 0.1%.

Wednesday's move marked a pause in a rally fueled by hopes for Covid-19 vaccines and easing concerns around the U.S. presidential transition. President-elect Joe Biden's pick of former Federal Reserve head Janet Yellen for Treasury secretary has also increased hopes of sizable stimulus measures.

Countering that optimism are concerns that the coronavirus pandemic continues to threaten households and raises the prospect of further restrictions. As of Tuesday, there were 88,080 hospitalized patients in the U.S., a record high for a 15th consecutive day, according to the Covid Tracking Project.

"We are certainly in a much more optimistic position than we were a few weeks ago," said Seema Shah, chief strategist at Principal Global Investors, stating that investors' major concerns, from the pandemic to a rocky political transition, have been mostly resolved.

"The market is trying to balance itself between the short-term outlooks of a winter wave of Covid cases and the more positive medium-term outlook thanks to the vaccine and the recovery that will follow. But that medium-term outlook is plagued with uncertainties," she added.

Gap fell 16% after reporting flat sales in the third quarter. Executives at the retailer cautioned that rising virus cases would likely weigh on store visits during the crucial holiday shopping season.

HP dropped 1.1%, despite posting revenue that was better than expected.

The declines followed a slate of mixed readings on the U.S. economic recovery, with some data releases brought forward due to Thursday's Thanksgiving holiday. U.S. markets are shut Thursday and close early on Friday.

Weekly figures from the Labor Department showed jobless claims rose for a second consecutive week, a sign that resurging Covid-19 cases are taking a toll on the labor market. Meanwhile, durable goods orders rose by more than forecast.

C onsumer spending rose in October for the sixth consecutive month while incomes fell 0.7%. Consumer spending has been the driving force behind the economy's recovery and investors will be watching for signs of how Americans are faring.

Minutes from the Federal Reserve's last monetary policy meeting earlier this month are also due later in the session.

In commodities, Brent crude, the international benchmark for oil, rose 1.1% to $48.28 a barrel. Gold prices ticked 0.4% higher to $1,811.80 a troy ounce.

Overseas, the pan-European Stoxx Europe 600 fell 0.3%, led by auto makers and energy companies. Asian benchmarks were mixed, with the Japanese Nikkei 225 ending the day 0.5% higher, while China's Shanghai Composite fell 1.2%.

Write to Will Horner at William.Horner@wsj.com

(END) Dow Jones Newswires

11-25-20 1044ET

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