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(Photo: AP)
(Photo: AP)

Wall Street slips as tough stimulus talks loom; 3M, McDonald's disappoint

Senate Republicans announced on Monday a $1 tn aid package hammered out with the White House but the proposal sparked immediate opposition from both Democrats and some Republicans

US stocks fell on Tuesday as lawmakers geared up for grueling talks over a coronavirus aid plan, with the blue-chip Dow index weighed down by 3M and McDonald's shares after the companies reported quarterly profits that missed estimates.

Industrial conglomerate 3M Co dropped 4.3% as it reported a plunge in demand across its business units in the second quarter.

McDonald's Corp fell 2% after posting a bigger-than-expected drop in global same-store sales and missing profit expectations, as its restaurants were shut due to the pandemic.

Pfizer Inc , on the other hand, rose 2.7% after it raised its full-year forecast on strong demand for cancer drugs and blood thinners. Late on Monday, the drugmaker announced a pivotal global study to evaluate a COVID-19 vaccine candidate.

Of the 130 S&P 500 companies that have reported, about 80% of them surpassed significantly lowered forecasts for profit, according to Refinitiv IBES data, better than the average of 71% companies beating profit estimates over the past four quarters.

A rally in U.S. stocks slowed recently as investors worried about signs of a stalling economic recovery amid a resurgence in coronavirus cases, while awaiting progress on government stimulus talks.

Senate Republicans announced on Monday a $1 trillion aid package hammered out with the White House — four days before millions of Americans lose unemployment benefits — but the proposal sparked immediate opposition from both Democrats and some Republicans.

Latest data showed U.S. consumer confidence ebbed in July amid a flare-up in coronavirus infections across the country.

The U.S. Federal Reserve also said it would extend several of its lending facilities through the end of the year, in a sign the economic impact of the pandemic has been more prolonged than expected.

"We're in a bit of a pause on the economic recovery while we wait for more progress on vaccine developments and treatments," said Jeff Buchbinder, equity strategist at LPL Financial in the Greater Boston Area.

A major focus this week will be results from members of Wall Street's trillion-dollar club — Apple Inc , Amazon.com Inc , Alphabet Inc — and Facebook Inc .

Technology stocks weighed the most on the benchmark S&P 500 index.

At 11:14 a.m. ET, the Dow Jones Industrial Average was down 93.57 points, or 0.35%, at 26,491.20, the S&P 500 was down 2.52 points, or 0.08%, at 3,236.89. The Nasdaq Composite was down 41.09 points, or 0.39%, at 10,495.18.

The U.S. central bank is expected to reiterate its accommodative stance when it wraps up its two-day policy meeting on Wednesday afternoon.

Harley-Davidson Inc slid 7.8% after reporting an unexpected quarterly loss due to disruptions caused by the virus outbreak.

Declining issues outnumbered advancers for a 1.10-to-1 ratio on the NYSE and a 1.59-to-1 ratio on the Nasdaq.

The S&P index recorded 21 new 52-week highs and no new low, while the Nasdaq recorded 42 new highs and 15 new lows.

This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.

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