Stocks turn south after S&P breaks record

Stocks turned negative Tuesday after the S&P 500 index broke an intraday record high as the market continues to tread water amid stalled stimulus negotiations.

The S&P rose as high as 3,394.81 on Tuesday, breaking a record set in February, before dropping 6 points below its Monday close for a total loss of 0.2 percent. The Dow Jones Industrial Average was down more than 120 points shortly after 10:30 a.m. Tuesday, while the Nasdaq composite was little changed.

Despite mounting questions about the future of another stimulus bill, the stock market has held on to more than four months of fairly steady gains that have made up for almost all of Wall Street’s losses triggered by the onset of the coronavirus pandemic.

The Nasdaq composite broke record highs earlier this summer as major technology companies rallied and the S&P has flirted with new records for several weeks. The Dow remains slightly below its February peak but has recovered more ground than the broader U.S. economy.

The U.S has gained back 9.3 million of the more than 20 million jobs lost due to the coronavirus-driven recession, dropping the unemployment rate from post-Great Depression peak of 14.7 percent in April to 10.2 percent in July. But the boost to weekly jobless benefits, eviction protections, direct payments and emergency business loans approved by the federal government in March have expired or washed out of the economy.

Economists across the ideological spectrum expressed dismay when the Senate and House recessed for the summer last week without agreeing on a compromise to extend the expired aid.