US markets open lower following days of gains
US markets opened slightly lower today following days of gains driven by massive government economic intervention.
The S&P 500 opened down 0.8 per cent at 2,604, the Dow opened down half a per cent at 22,207 and the Nasdaq Composite opened down 0.3 per cent at 7,749.
Despite clawing back some ground in recent days, the S&P 500 was headed for its worst first quarter since 1938 amid growing evidence of the scale of the damage caused by the collapse in oil prices and business activity due to the coronavirus.
The FTSE 100 similarly is on track to close out the quarter today with its worst three-month result since 1987.
Tech firms Apple and Microsoft fell in premarket trading after a recent rally that was spurred by investors looking for stocks likely to withstand an economic hit.
Confidence in equity markets had crept back in the past week, thanks to a $10 trillion (£8 trillion) global monetary and fiscal stimulus, but Wall Street’s indicator of future volatility is still close to levels last seen in 2008.
“There is still uncertainty so it’s hard to say that we’re right back to going ‘risk on’ here,” said Jack Janasiewicz, portfolio manager at Natixis Investment Managers Solutions.
“It wouldn’t be surprising if we get a little bit of weakness in the markets over the next couple of weeks and re-test or break the lows.”
Sliding from the record highs of mid February, the Dow Jones and S&P 500 indexes are now set to end the quarter more than 18 per cent lower from the start of the year as the health crisis deepens in the US and disrupts supply chains.
Yesterday, coronavirus linked deaths in the US surpassed 3,000 with at least 540 deaths yesterday.
Reported cases in the country climbed to more than 163,000.