By Yasin Ebrahim
Investing.com - The Dow slipped on Wednesday, but remain supported as data pointing to underlying weakness in the U.S. consumer was offset by growing expectations that fiscal help is on the way.
The Dow Jones Industrial Average fell 0.22%, or 67 points. The S&P 500 was up 0.12%, while the Nasdaq Composite added 0.32%.
U.S. lawmakers appear to be closing in on a stimulus deal - expected to include much-needed support for businesses and unemployed Americans – after Senate Majority Leader Mitch McConnell said a "major headway" had been made in talks.
The Commerce Department said on Wednesday that retail sales fell 1.1% last month, a deeper contraction than the 0.3% decline expected. The retail sales control group – which has a larger impact on U.S. GDP – fell 0.5% confounding expectations for a 0.2% rise.
"COVID and the UI cliff will continue to weigh on spending in December, but we believe Congress is very close to finalizing a new stimulus bill which will reinstate enhanced UI (unemployment insurance) benefits from January through April at $300/week (or $1200/month)," Jefferies (NYSE:JEF) said in a note.
Consumer discretionary stocks shrugged off signs of consumer weakness thanks to a rise in eBay (NASDAQ:EBAY), Hasbro (NASDAQ:HAS), and Chipotle.
Chipotle Mexican Grill (NYSE:CMG) rose more than 4% after Stifel upgraded its rating on the stock to buy from hold, and raised its price target to $1,500 from $1,400.
Technology stocks continued their strong start to the week, with Twitter Inc (NYSE:TWTR) among the notable gainers after an upgrade from JPMorgan (NYSE:JPM).
JPMorgan upgraded Twitter to overweight from neutral with a $65 price target on expectations for online advertising growth to reaccelerate next year.
"We believe Twitter will show the biggest rebound given its sharper pandemic-driven ad decline, along with revenue prioritization throughout the company, early benefits from rebuilt ad tech through the new Ad Server and rollout of Map 2.0, and increases in both advertiser count and ad load," JPMorgan said.
Energy stocks cut losses as oil prices eased from lows on data showing a larger-than-expected U.S. weekly draw of 3.13 million barrels.
In other news, Tilray (NASDAQ:TLRY) jumped 24% after agreeing to a tie-up with Aphria (TSX:APHA), creating a combined business valued at about $3.9 billion
The mixed day on Wall Street comes ahead of the Federal Reserve decision in the afternoon and a press conference by Chairman Jerome Powell.