The Dow Jones Industrial Average slipped Monday, after hitting a record last week, as investors worried that elevated Covid-19 infection levels could weigh on economic growth through the winter months.
The blue-chip index fell 165 points, or 0.6%, in morning trading. The S&P 500 declined 0.2%, while the technology-heavy Nasdaq Composite rose 0.5%.
Stocks have rallied to record highs in recent weeks on brightening economic prospects due to the development of Covid-19 vaccines. But rising coronavirus infection levels and their potential impact on the rebound is weighing on sentiment. New restrictions intended to slow the spread of the virus in California went into effect Sunday night, after the number of people hospitalized in the U.S. because of Covid-19 hit another record.
“For U.S. growth, the vaccine is not going to have a substantial impact on this third wave,” said James McCormick, a strategist at NatWest Markets. “The U.S. growth picture in the very near term is clearly tilting lower.”
Data released Friday showed that U.S. job growth slowed sharply in November, suggesting the labor-market recovery is losing steam amid the surge in coronavirus cases and new business restrictions.