Warnings Of Coronavirus Return Knock The Air Out Of The Market

The markets started the day strong and was looking to break out.  Then, comments from Dr. Anthony Fauci about the virus coming back in the fall took some air out of the market.  Selling in FAANG and e weak economic data added to the sell off.  

• Netflix (NFLX) - 3.7%, 
• Amazon (AMZN) -2.6% 
• Alphabet (GOOG), which reports after the bell, -2.1%
• Facebook (FB) -1.4%
• Apple (AAPL) -1%

The Consumer Confidence Index dropped to 86.9 in April, down from a revised 118.8 in March, and slightly lower than expected. Americans' confidence in the economy in April had the largest plunge since 1973 and was the lowest level since 2014 due to the coronavirus. Consumers are worried about their financial prospects and potential future spending. However, many respondents are also feeling the worst might be behind them as seen in the expectations for the next months.

• Present Situation Index declined to 76.4 from 166.7, the largest monthly drop on record
• Expectations Index rose to 93.8 from 86.8

Comments from respondents:

• Expecting Business conditions to worsen increased to 25.7 from 16.4
• Expecting more jobs increased to 41.0 from 16.9
• Anticipating fewer jobs increased to 20.8 from 17.6
• Business conditions are “good” 20.8% from 39.2%
• Business conditions are “bad”: 45.2% from 11.7%
• Jobs are “plentiful” 20.0% from 43.3%
• Jobs are “hard to get” 33.6% from 13.8%
• Expecting Business conditions will improve increased to 40.0 from 18.7

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To see the Consumer Confidence chart, click here.

At midday, the Dow is hanging on to slight gains, while the S&P 500 and Nasdaq are lower.  However, it’s a bit misleading, as all but 3 sectors on the S&P are in the green as rotation continues.

Breadth continues to be positive and 52-week highs far outpace 52 week lows.

Starbucks (SBUX) and Alphabet/Google (GOOGL) report earnings after the bell.