Dow Jones falls short of 20,000 as stocks stumble

The Dow Jones pulled back on Wednesday (21 December), a day after after hitting a record high at closing on Tuesday.

The Dow Jones dropped 32.66 points, or 0.2%, to close at 19,942, to elude the 20,000 milestone. The Nasdaq Composite fell 12.51 points, or 0.2%, to settle at 5,471.43. Meanwhile the S&P 500 index lost 5.58 points to drop to 2,265.18.

"This is what you'd expect if we were approaching a real technical level. We come very close before breaking above it," Randy Frederick, vice president of trading and derivatives at Charles Schwab, told CNBC. Frederick suggested that 20,000 on the Dow is more of a psychological level.

According to the BBC, the Dow has risen nearly 1,000 points in less than a month as investors predict President-elect Donald Trump's policies will boost the US economy.

Despite Wednesday's drop, the blue-chip gauge is up 14.4% compared with the same time last year and has outperformed the S&P 500 index by more than 3%, MarketWatch reported.

"The common wisdom today is that the stock market honeymoon will last until the inauguration, and then hit a speed bump. I am not sure it will last that long," James M Meyer, chief investment officer at Tower Bridge Advisors, wrote in a not to clients. "Big moves tend to last six-eight weeks before correcting. That suggests maybe the start of the New Year will be a reality check time."

As for the other two main indexes, eight of the S&P's 11 main sectors finished the session in the red, with the healthcare sector weighing on the main indexes, MarketWatch reported. The Nasdaq Composite, in turn, was weighed down by a drop in biotechnology shares. The iShares Nasdaq Biotechnology ETF fell 1.1%.

Investors expect trading volumes to decline significantly as the holidays approach, CNBC reported.