US STOCKS-S&P 500 ends lower as COVID worries lightened by stimulus

(For a live blog on the U.S. stock market, click LIVE/ or type
LIVE/ in a news window.)
* Big banks jump after Fed's stress test results
* U.S. Congress set to vote on $900 bln relief bill
* Tesla slips from record high in its S&P 500 debut
* Dow up 0.12%, S&P down 0.39%, Nasdaq off 0.10%

(Updates with closing prices)
By Stephen Culp
NEW YORK, Dec 21 (Reuters) - The S&P 500 closed lower on
Monday, having clawed its way back from steep losses early in
the session as investors juggled the outbreak of an ominous new
strain of COVID-19 with the passage of a long-anticipated
stimulus package.
The Nasdaq dipped slightly to join the S&P 500 in the red,
but financials helped the blue-chip Dow reverse course for a
modest gain.
"The 'Santa rally' will have to wait," said David Carter,
chief investment officer at Lenox Wealth Advisors in New York.
"Troubling news about COVID in the UK has reminded markets that
COVID isn't solved yet; the road ahead may be bumpy and
uncertain."
Congress hammered out a pandemic relief agreement on Sunday
after months of partisan wrangling. The $900 billion package,
expected to pass on Monday, includes unemployment aid, small
business relief, and vaccine distribution, but the dollar amount
fell short of what many had hoped for. "Fiscal stimulus plan appears big enough to hold off a
recession, but not for long," Carter added. "But while it's not
as large as many market participants hoped, it does include many
meaningful actions that can support markets."
But the emergence of new, highly infectious strain of
COVID-19 in Britain has raised fears of additional shutdowns,
and prompted countries around the world to shut their doors to
travelers from the United Kingdom. The news sent airline stocks sliding, even with the prospect
of $15 billion in payroll assistance for commercial carriers
included in the stimulus deal. The S&P 1500 Airline index
.SPCOMAIR lost 1.2%. Tesla Inc TSLA.O became the most valuable company ever
added to the S&P 500 and will account for about 1.69% of the
index. The electric car maker's stock dropped 6.5%. Banks bucked the trend. The U.S. Federal Reserve released
the results of its semiannual stress test late Friday and
announced relaxed restrictions on buybacks and dividends. The
S&P Banking index .SPXBK jumped 2.7%. Goldman Sachs Group GS.N surged 6.1%, surpassing its
pre-COVID share price.
The Dow Jones Industrial Average .DJI rose 37.4 points, or
0.12%, to 30,216.45, the S&P 500 .SPX lost 14.49 points, or
0.39%, to 3,694.92 and the Nasdaq Composite .IXIC dropped
13.12 points, or 0.1%, to 12,742.52.
Of the 11 major sectors in the S&P 500, financials .SPSY
and tech .SPLRCT were the only percentage gainers.
Nike Inc NKE.N rose 4.9% after the athletic apparel maker
boosted its full-year revenue forecast, prompting multiple
brokers to raise their price targets. Lockheed Martin Corp LMT.N lost 1.9% after announcing it
would buy U.S. rocket engine maker Aerojet Rocketdyne Holdings
Inc AJRD.N for $4.4 billion. International Business Machines Corp IBM.N shed 2.0% after
saying it would acquire Finland-based startup Nordcloud, in its
latest effort to bolster its cloud-computing business.
Declining issues outnumbered advancing ones on the NYSE by a
1.85-to-1 ratio; on Nasdaq, a 1.26-to-1 ratio favored decliners.
The S&P 500 posted 16 new 52-week highs and no new lows; the
Nasdaq Composite recorded 182 new highs and 17 new lows.
Volume on U.S. exchanges was 11.60 billion shares, compared
with the 11.68 billion average over the last 20 trading days.