US open: Stocks record early losses amid oil price rout
US stocks opened lower on Monday following a sharp decline in US crude oil prices.
As of 1530 BST, the Dow Jones Industrial Average was down 1.50% at 23,879.36, while the S&P 500 was 1.11% weaker at 2,842.63 and the Nasdaq Composite came out the gate 0.54% softer at 8,603.73.
The Dow opened 363.13 points lower on Monday after wrapping up the previous week in the green for a second consecutive time as sentiment got a boost when Gilead Sciences said patients with severe coronavirus symptoms were quickly recovering after using its Remdesivir drug.
However, things took a turn for the worse at the bell on Monday after West Texas Intermediate tumbled 36.23% to $11.65 per barrel, raising questions about just how deep this quarter's economic slowdown will be.
Also in focus, New York Governor Andrew Cuomo said over the weekend that the state was "past the high point" of new cases, while Treasury Secretary Steven Mnuchin said the White House and Congress were close to striking a deal on a second round of loans for small businesses.
SpreadEx's Connor Campbell said: "Tanking oil prices, anxiety over what is almost certain to be a tough data gauntlet – especially Thursday's US jobless claims/flash PMIs pairing – and the deranged behaviour of Donald Trump are all contributing to the toxic tone of Monday’s trading."
In macro news, the Chicago Fed's National Activity Index fell in March as the coronavirus pandemic escalated in the States.
The index was -4.19 in March, a broad and swift turnaround when compared to the 0.06 reading recorded in February, according to the Federal Reserve Bank of Chicago.
The monthly drop also pulled the three-month moving average down to -1.47 from -0.2 in February, with the Fed pointing out that figures below -0.7 were associated with "an increasing likelihood of a recession".
On the corporate front, shares in the likes of Chevron, Exxon and Halliburton were all sharply lower as a result of the oil price rout.