Tuesday 28 April 2020 6:20 pm

US stocks slip back as consumer confidence plunges

Wall Street stocks reversed course in morning trading after a survey showed US consumer confidence plunged in April and drugmaker Merck dragged down health equities.

The S&P 500 was marginally lower three hours into trading. The Nasdaq was down 0.7 per cent but the Dow Jones was up 0.2 per cent

Read more: FTSE 100 ticks up as oil troubles dampen Covid-19 hopes

European markets finished the day higher, however, as investors looked past falling oil prices to governments’ plans to reopen economies after lengthy coronavirus lockdowns.

The UK’s FTSE 100 ended 1.9 per cent higher in afternoon trading, while Germany’s Dax was up 1.3 per cent. The pan-European Stoxx 600 rose 1.7 per cent.

In the US, markets were initially boosted by conglomerate 3M, which makes the N95 respirator mask. Its shares rose as much as five per cent after it reported a rise in income.

Stocks also rose as investors took stock of moves by some states to lift certain coronavirus restrictions.

Yet investor sentiment waned after a survey showed consumer confidence plunged in April amid mass job losses due to the coronavirus shutdown.

US drugmaker Merck also weighed on the markets. Its shares slipped three per cent after it said sales would be down by more than $2bn this year (£1.6bn). The wider healthcare index also fell.

Edward Moya, senior market analyst at currency firm Oanda, said investors were selling stocks ahead before tech firms report their results.

“US stocks are turning negative as investors start to abandon tech-heavy positions before the technology giants start to report,” he said. 

“Alphabet posts earnings after the close, Facebook and Microsoft report tomorrow, and Amazon and Apple deliver results on Thursday.”

Read more: Oil prices reverse losses as US government considers aid for sector

As stocks reversed course, oil markets regained some lost ground after US government officials indicated that it would provide support to the battered sector.

The WTI crude oil price, the US benchmark, rose 0.6 per cent higher in US afternoon trading to $12.85 per barrel. Brent crude was up 0.8 per cent to $20.15 per barrel.