US stocks declined sharply on Monday after new developments pointed to a worsening of the COVID-19 pandemic. The Dow Jones closed at 28,195.42 on Monday, 410.89 points lower than it opened; the Nasdaq fell by 192.67 points to close at 11,478.88, and the S&P 500 declined by 56.89 points, closing at 3,426.92.
Over the weekend, House Speaker Nancy Pelosi (D-CA) warned that just 48 hours remained for her and US Treasury Secretary Steve Minuchin to reach a deal on a new COVID-19 economic aid package before the November 3 election.
"The 48 only relates to if we want to get it done before the election, which we do," Pelosi told ABC's This Week on Sunday. "But we're saying to them we have to freeze the design on some of these things. Are we going with it or not? And what is the language."
However, Senate Majority Leader Mitch McConnell (R-KY) has said that while the Senate may vote on some measures later this week, including a stand-alone Paycheck Protection Program bill, he remained cool to the much larger bill sought by Democrats.
Scott Wren, senior global market strategist at the Wells Fargo Investment Institute, told CNBC Wall Street investors are “going to continue to be very sensitive to any talk that has anything to do with stimulus.”
“The way we’ve rallied [off the March lows] has been by expecting better cyclical news in terms of a vaccine, the Federal Reserve being very easy and [fiscal] stimulus,” Wren said. “I think all three of those are very important and we’ve got one leg that’s been pulled out or, at least, it’s wobbly.”
Meanwhile, COVID-19 cases have continued to surge in the US and in Europe, as global coronavirus cases hit 40 million on Monday.
According to data from the US Centers for Disease Control and Prevention, the US has recorded 387,692 new cases of COVID-19 in the last seven days, including more than 47,000 new cases on Sunday alone. Meanwhile, Europe is registering roughly 97,000 new cases per day, a 44% spike from last week.
At his rally in Prescott, Arizona, on Monday, US President Donald Trump said "The pandemic will soon end ... It's rounding the corner. They hate it when I say it."