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S&P 500 falls as Tesla drops 6% in debut

The S&P 500 dropped 0.39% on Monday amid a poor debut on the index from Tesla and concern over a new strain of COVID-19 reported in Europe.  Photo by John Angelillo/UPI
The S&P 500 dropped 0.39% on Monday amid a poor debut on the index from Tesla and concern over a new strain of COVID-19 reported in Europe.  Photo by John Angelillo/UPI | License Photo

Dec. 21 (UPI) -- The S&P 500 dropped on Monday as Tesla's stock plummeted upon debuting on the index and markets responded to news of a new strain of COVID-19.

The equity index fell 0.39% to end the day after falling to a session low of nearly 2% earlier in the day. The Nasdaq Composite dropped 0.10%, while the Dow Jones Industrial Average ended the day up 37.40 points, or 0.12%.

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Tesla stock declined 6.49% in the electric car maker's first day of trading on the S&P 500.

Monday's decline came as the company's shares were up 687% on the year and rose $39.10, or 6%, to a closing record at $695.

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Tesla entered the S&P 500 with a 1.7% weighting, causing the broader S&P 500 to fluctuate one point for every $11.11 it moves.

Travel stocks fell as Britain entered its highest level of lockdown and other European nations banned travel from the country after the presence of a new strain of COVID-19 was reported over the weekend.

American Airlines stock fell 2.48% and United Airlines dropped 1.53%, while Norwegian Cruise Line declined 1.59% and Royal Caribbean slid 0.65%.

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The Dow avoided losses Monday as Nike rose 4.91% following strong earnings, while Goldman Sachs gained 6.07% and JPMorgan Chase grew 3.75% as the Federal Reserve announced share buybacks for banks would continue into the first quarter of 2021.

Markets also responded positively to Congress announcing plans to vote on a $900 billion coronavirus relief bill and a government funding measure in a deal reached over the weekend.

The package includes $600 individual stimulus payments which Treasury Secretary Steven Mnuchin told CNBC would be sent out as soon as next week.

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