Wall Street falls as stocks fail to capitalise on bear market

US stock markets dropped today, wiping out a portion of yesterday’s bump as US consumer confidence fell to its lowest point since July.

Following its first ever 1,000-point daily surge yesterday, the Dow Jones fell 441 points to 22,439.

The 1.9 per cent drop was led in part by technology stocks as Apple, Amazon and Google’s parent company Alphabet dropped over two per cent.

Meanwhile, the S&P 500 fell around two per cent to 2,419 points.

The drop worried analysts who said stocks should have seized on yesterday’s momentum.

“The inability of markets to follow-through on what was a classic ‘bear market rally’ sends a worrying signal – if this was the old bull market of a few months ago the momentum trade would have taken off by now, but instead Wall Street continues to edge lower, while in Europe the reversal has been swift and unrelenting,” said Chris Beauchamp, IG’s chief market analyst.

Oil markets also fell, with international standard Brent crude dropping 3.3 per cent to $52.73 per barrel.

Markets have feared a rise in oil production, with the price of Brent dropping around 40 per cent since year-highs in early October.

“It makes sense to expect both oil and stocks to move in lockstep, as fear reigns supreme among investors. All the signs point to a bottoming out in sentiment, positioning and fund flows, but until the price gives us a clear signal, momentum remains with the bears,” Beauchamp said.

The downturn in the US was mirrored in much of Europe, as the FTSE 100 closed down 1.52 per cent to 6,585.

The Europe-wide index Stoxx 600 fell 1.75 per cent to its lowest point since November 2016 after a 0.5 per cent rise in early trading.