U.S. stocks end mostly lower after an early rally evaporates

Stocks ended mostly lower on Wall Street Monday after an early rally evaporated. In the U.S., investors are waiting to see if Congress can break a logjam on delivering more aid to people, businesses and local governments affected by the coronavirus pandemic, while in Europe talks continue on trying to reach a trade deal between Britain and the European Union. The S&P 500 slipped 0.4%. It was up as much as 0.9% earlier. The index is coming off its worst weekly performance since Halloween, and extended its losing streak to four consecutive trading days. Treasury yields rose.

U.S. stock indexes are wavering between small gains and losses Monday as the country’s first vaccinations against COVID-19 have the end of the pandemic slowly materializing into hazy sight.

Investors are also waiting to see if government officials can deliver any progress on separate negotiations happening in Washington and on the other side of the Atlantic. Both sets of talks have been messy and dispiriting, but they could give markets a further boost if successful.

The S&P 500 was up 0.1% after having been up by 0.9% in the early going. The benchmark index is coming off a 1% decline last week, its worst weekly performance since Halloween. Losses in the financial, energy and industrial sectors outweighed gains in technology stocks and companies that rely on consumer spending. Treasury yields were mostly higher, a sign of optimism in the economy.

The Dow Jones Industrial Average was down 19 points, or 0.1%, to 30,026, as of 3 p.m. Eastern time, and the Nasdaq composite was 1% higher.

“To a large degree, we’re in a wait-and-see mode,” said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management. “The good news is the vaccine is being distributed, which suggests we’re on the road to recovery.”

Hospital workers are unloading the first batches of a coronavirus vaccine developed by Pfizer and its German partner, BioNTech, following its approval for emergency use by U.S. regulators. Health care workers and nursing home residents will be first in line for vaccinations, and the hope in markets is that a wider rollout next year will help pull the economy back toward normal following its devastation this year.

Such optimism has helped Wall Street’s rally broaden out beyond Big Tech stocks, which were pulling the market higher almost singlehandedly earlier in the pandemic. Many of the stocks climbing Monday included companies that desperately need the economy to get healthier and reopen.

“The market is really looking ahead six months and, now that the vaccine is being rolled out, hope has become reality,” said Marc Chaikin, founder of Chaikin Analytics.

Smaller companies were also rising more than their larger rivals, an indication that investors are feeling more confident about the economy’s prospects. The Russell 2000 index of smaller stocks gained 0.5%.

Alexion Pharmaceuticals soared 30.3% for the biggest gain in the S&P 500. It’s the first trading day for the stock since AstraZeneca said on Saturday that it would buy the company for $39 billion in cash and stock.

Of course, the hopes for the economy in the future are tempered by the worsening pandemic in the present. Surging coronavirus counts have forced a downshift to the economy’s momentum, including last week’s worse-than-expected report on joblessness. The increasing death toll is pushing governments around the world to bring back varying degrees of restrictions on companies, and it’s also scaring potential customers away from businesses on its own.

To help in the interim, economists and investors have been asking Congress to deliver another round of financial support for the economy. Democratic and Republican legislators have been discussing a bipartisan possibility, which has raised hopes on Wall Street recently. But bitter partisanship has prevented a deal for months, and a deep divide still dominates on Capitol Hill.

Even without another round of stimulus, investors are facing a robust environment heading into next year that includes low inflation and an accommodative Federal Reserve.

“The market is prepping itself for a really good year in 2021 with earnings starting to kick in during the second and third quarter,” Chaikin said.

Across the Atlantic, hope was rising that talks are making progress in what has been just as frustrating as the stalemate in Washington, a potential deal on the terms of the United Kingdom’s exit from the European Union.

The EU’s chief negotiator Michel Barnier said Monday he believes a trade agreement is possible following nine months of negotiations, now that remaining disputes have been whittled down to just two. Both sides are still teetering on the brink of a no-deal departure, though. They have committed to a final push ahead of Jan. 1, when a transitional period following Britain’s Jan. 31 departure from the bloc is to end.

Hope for a deal helped the value of the British pound rise against other currencies. In European stock markets, France’s CAC 40 rose 0.4%, and Germany’s DAX returned 0.8%. The FTSE 100 in London fell 0.2%.

Earlier Monday, the quarterly “tankan” survey by the Bank of Japan showed business sentiment has improved sharply with expectations for a recovery from a year-long recession.

Although still in negative territory, the main measure of business conditions of large manufacturers was a marked improvement from the past several quarterly reports as Japan battled the coronavirus pandemic.

Japan’s Nikkei 225 index added 0.3%. Other Asian markets were mixed. Hong Kong’s Hang Seng shed 0.4%, South Korea’s Kospi fell 0.3% and stocks in Shanghai rose 0.7%.

In another sign of improving confidence in the economy, the yield on the 10-year Treasury rose to 0.89% from 0.87% late Friday.

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Associated Press Business Writer Elaine Kurtenbach and writer Raf Casert contributed.