By Caitlin Ostroff Close Caitlin Ostroff and Gunjan Banerji Close Gunjan Banerji Updated Dec. 18, 2020 4:04 pm ET U.S. stocks edged lower Friday as investors monitored whether Covid-19 infections and worsening economic data would push lawmakers to cement a coronavirus aid package. The S&P 500 slipped 0.4% as of the 4 p.m. ET close of trading. The Dow Jones Industrial Average lost about 117 points, or 0.4%. The Nasdaq Composite fell less than 0.1%. Friday's stock moves mark a pause after major U.S. indexes clinched fresh highs this week on optimism about a stimulus package. Top Republicans and Democrats have been closing in on a coronavirus relief package that would send direct payments to many Americans, enhance unemployment benefits, provide aid to small businesses and fund distribution of the Covid-19 vaccine, among other measures. However, a deal still hasn’t been reached, while Covid-19 infections and measures to contain its spread continue to weigh on the economy. ”I think it’s all about stimulus,” said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance. “Anything that looks to slow that down or postpone that until January will be seen as a negative in the market.” Many investors are also looking ahead to the end of the trading session. Friday is expected to be one of the busiest trading days of the entire year. It’s quadruple witching, when options and futures on both indexes and stocks expire simultaneously. Additionally, a slew of indexes are rebalancing today, driving heavy activity across the market. One index swap that traders have been buzzing about for weeks is that of Tesla, which is expected to join the S&P 500 on Monday, spurring heavy activity around the market close today. Dozens of index funds that track the S&P 500 will need to purchase tens of billions of dollars of stock at Friday’s closing price to follow the index as closely as possible. Tesla shares were trading 0.4% higher even as the broader market declined. In other corporate news, shares of FedEx fell 5.6% after the delivery company beat analyst profit expectations, but said higher revenue was partially offset by increased costs, including from safety equipment to protect workers from Covid-19. Recent Market Moves Stocks in Asia were mostly lower. The Wall Street Journal reported that U.S. officials were debating how broad to make a list of Chinese companies banned from investment by Americans because of ties to China’s military. China’s Shanghai Composite Index closed 0.3% lower and Hong Kong’s Hang Seng fell 0.7%. Japan’s Nikkei 225 index fell 0.2%. Shares in Semiconductor Manufacturing International Corp. fell 5.2% in Hong Kong trading after the Trump administration added China’s largest manufacturer of computing chips to the export blacklist, restricting the company’s access to high-end technology. The pan-continental Stoxx Europe 600 declined about 0.4%. Investors were closely watching negotiations between the U.K. and the European Union over a post-Brexit trade deal. Some expect that the British pound could rally further if a deal is reached. European negotiators have said they want a deal by Sunday. “The clock is running down,” said Hugh Gimber, a strategist at J.P. Morgan Asset Management. A Christmas tree decoration with the New York Stock Exchange’s logo, in Manhattan’s financial district. Photo: jeenah moon/Reuters Write to Caitlin Ostroff at caitlin.ostroff@wsj.com and Gunjan Banerji at Gunjan.Banerji@wsj.com Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8