US STOCKS-Wall Street falls as stimulus rally cools, Tesla hits record high

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* 'Quadruple witching' to push up volumes, volatility
* Tesla rises in high-volume trade
* Indexes down: Dow 0.7%, S&P 500 0.7%, Nasdaq 0.3%

(Updates to late afternoon)
By Karen Pierog and Caroline Valetkevitch
Dec 18 (Reuters) - U.S. stocks declined on Friday, pulled
down by uncertainty around a coronavirus stimulus deal, while
Tesla shares hit a lifetime high in anticipation of their
addition to the S&P 500 next week.
All three major indexes hit a record high at the opening
before retreating. The S&P 500 technology index .SPLRCT , which
has led gains this week, was the biggest drag on the overall
benchmark index, followed by health care .SPXHC .
Electric-car maker Tesla Inc TSLA.O rose 2.5% in heavy
volume, will become on Monday the most valuable company to be
ever added to Wall Street's main benchmark index. "You're already seeing significant levels of volume in Tesla
stock today, moving a lot higher as a lot of these different
ETFs and mutual funds position ahead of the change to get us
close to the price as possible for tracking error purposes,"
said Lindsey Bell, chief investment strategist at Ally Invest,
in Charlotte, North Carolina.
Investors are seeing increased trading volumes in the day
due to the expiration of stock index futures, stock index
options, stock options and single stock futures at the end of
trade, also known as quadruple witching.
The U.S. Congress looked increasingly unlikely on Friday to
meet a deadline to agree on $900 billion in fresh COVID-19 aid
and instead may pass a third stopgap spending bill to keep the
government from shutting down at midnight. Recent weak economic data has increased pressure on
lawmakers to reach a deal.
"Investors definitely want to see something come through or
like to see something come through on the stimulus front sooner
rather than later as COVID cases continue to rise and economic
data has shown that it is beginning to deteriorate," Bell said.
The Dow Jones Industrial Average .DJI fell 215.51 points,
or 0.71%, to 30,087.86, the S&P 500 .SPX lost 27.36 points, or
0.73%, to 3,695.12 and the Nasdaq Composite .IXIC dropped
38.87 points, or 0.3%, to 12,725.88.
Trading could become more volatile heading into the close.
"There's a ton more volume, but I don't necessarily think it
has a real directional basis," said Christopher Murphy, co-head
of derivatives strategy at Susquehanna Financial Group.
"Everyone really wanted a stimulus package by the end of today.
If we're not going to get it, the market is going to be down.
That's going to trump anything related to quad witching."
The prospect of continued monetary and fiscal stimulus has
helped stocks look past the economic impact of the pandemic, and
set them up for strong annual gains, despite a rocky start to
the year.
FedEx Corp FDX.N fell 5.3% after it did not give an
earnings forecast for 2021, even as its quarterly profit almost
doubled. Rival United Parcel Service Inc's UPS.N shares also
dipped.
​ Microsoft Corp MSFT.O was down 1.2% after it said it
found malicious software in its systems related to a massive
hacking campaign disclosed by U.S. officials this week.
Declining issues outnumbered advancing ones on the NYSE by a
1.41-to-1 ratio; on Nasdaq, a 1.11-to-1 ratio favored advancers.
The S&P 500 posted 32 new 52-week highs and no new lows; the
Nasdaq Composite recorded 280 new highs and 7 new lows.