By Yasin Ebrahim
Investing.com – The Dow struggled for direction Wednesday, as investors mulled the latest progress on stimulus and a jump in social media stocks led by Snap following strong results.
The Dow Jones Industrial Average fell 0.13%, or 36 points. The S&P 500 was up 0.03%, while the Nasdaq Composite was up 0.02%.
House Speaker Nancy Pelosi said she is optimistic "over the prospect" of an agreement, though admitted that President Donald Trump would likely have to sway Senate GOP leader Mitch McConnell to back the deal, Politico reported, citing Pelosi's comments on Sirius XM (NASDAQ:SIRI).
Getting a stimulus deal over the line would "really be up to whether the president can convince Mitch McConnell to do so," Pelosi said, according to the report.
McConnell has previously expressed little desire to back a large stimulus package, preferring to roll out a $500 billion skinny relief bill that includes fiscal relief to Americans and small businesses. A vote on the Senate GOP's $500 billion relief package gets underway later today.
The latest remarks on a deal come just a day after Pelosi conceded that differences over state and local funding, as well as language over insurance liability continued to weigh on talks.
Pelosi and Treasury Secretary Steven Mnuchin are set for talks at 2.30 ET on Wednesday.
The malaise in the broader market was kept in check by a jump in communication services as social media stocks followed Snap Inc (NYSE:SNAP) higher.
Snap surged 35% after the social media company reported a surprise quarterly profit, led by a jump in user growth. The better-than-expected performance prompted Wedbush Securities to suggest that growth is likely to continue into Q4.
While Snap did not provide guidance, management did note that "revenue growth between 47 – 50% appears attainable, and the implied revenue figure of roughly $825 – 841 million is well above our prior estimate of $710 million and the prior consensus figure of $728 million," Wedbush said.
"Management also expects total DAUs of approximately 257 million, vs. our prior estimate of 255 million and prior consensus of 250 million," Wedbush added and raised its price target on the stock to $34.50 from $25.
Snap's bullish results pointed to signs of robust ad spending and triggered a surge in Twitter (NYSE:TWTR), Pinterest (NYSE:PINS) and Facebook (NASDAQ:FB).
Elsewhere on the earnings front, Netflix (NASDAQ:NFLX) fell 6% after the social media company's third-quarter profit and subscriber growth fell short of estimates as pull-forward demand seen earlier in the year faded.
Texas Instruments (NASDAQ:TXN), meanwhile, fell more than 2%, despite reporting quarterly results that topped Wall Street estimates.
Energy was among the biggest losers intraday, paced by a fall in oil prices as data showing a draw in US weekly inventories was overshadowed by ongoing fears about demand weakness amid rising Covid-19 infections.