Stocks slip as coronavirus restrictions tighten; sterling weakens

Stocks on global indexes mostly eased on Monday as worries escalated over increasing Covid-19 cases and economic restrictions, while sterling slumped as Britain and the European Union have yet to narrow their differences on a trade deal.

On Wall Street, the US benchmark S&P 500 slipped 0.2 per cent, retreating from its recent record high, but the Nasdaq posted a record closing high as investors snapped up mega-cap growth stocks.

Authorities in California, the most populous US state, on Monday compelled much of the state to close shop and stay at home the day after it reported a record 30,000-plus new coronavirus cases.

Investor eyes also continue to be on negotiations between Republicans and Democrats in the US Congress for approval of further coronavirus relief.

"It is just kind of a waiting game, we are waiting to see if there is going to be any stimulus attached to this funding bill," said Ross Mayfield, investment strategy analyst at Baird.

Expectations of a US stimulus aid package gathered pace after weak payrolls data on Friday.

The Dow Jones Industrial Average fell 148.47 points, or 0.49 per cent, to 30,069.79, the S&P 500 lost 7.16 points, or 0.19 per cent, to 3,691.96 and the Nasdaq Composite added 55.71 points, or 0.45 per cent, to 12,519.95.

Large-cap growth stocks, which had underperformed value stocks in recent weeks as investors looked to names likely to benefit from a reopened economy, edged up while value declined.

The MSCI world equity index, which tracks shares in 49 countries, was down 0.1 per cent, while the pan-European STOXX 600 index ended down 0.3 per cent.

British and EU leaders will meet face-to-face to try to seal a post-Brexit trade deal after failing again to narrow their differences on Monday.

That could raise the chance of a disorderly parting of ways at the end of the month.

Sterling fell in a sentiment reversal from Friday when the British currency rose to a 19-month high against the dollar.

Sterling was last trading at $1.34, down 0.51 per cent on the day.

Investors also await an EU summit starting on Thursday to break an impasse over a 1.8 trillion-euro coronavirus aid package, as well as the last European Central Bank policy meeting of the year on the same day.

In the bond market, yields on most US Treasuries fell as rising coronavirus caseloads drove investors to buy the safe-haven securities.

Benchmark 10-year notes last rose 13/32 in price to yield 0.93 per cent, from 0.97 per cent late on Friday.

Oil prices slipped, with traders weighing the positive impact from an OPEC+ deal on production against increasing coronavirus cases.

Brent crude fell 46 cents, or 0.9 per cent, to settle at $48.79 a barrel. US crude fell 50 cents, or 1.1 per cent, to settle at $45.76 a barrel. Spot gold prices gained.