(Reuters) – Wall Street bounced on Friday as Boeing said it would resume production of commercial jets next week, with investors also cheering President Donald Trump’s plan to reopen the economy and on hopes of a potential drug to treat COVID-19.
FILE PHOTO: Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., March 20, 2020. REUTERS/Lucas Jackson
The U.S. planemaker’s shares soared 11.7% on plans to resume commercial aircraft production in Washington state after halting operations last month due to the coronavirus pandemic.
The S&P 500 has now regained about 30% from a March trough and is set for its third weekly gain in four, following a raft of global stimulus and on hopes that statewide lockdowns would be eased as the outbreak showed signs of ebbing.
However, the index is still about 19% away from reclaiming its all-time high and analysts have warned of a deep economic slump, as a halt in business activity puts millions of Americans out of work.
“The overall picture remains one of high uncertainty with things certainly looking up from a month ago, but the economic and public-health outlook is still far from rosy,” said Art Hogan, chief market strategist at National Securities in New York.
Late on Thursday, Trump outlined a plan to reopen U.S. states in a staggered, three-stage process, but the plan was a set of recommendations rather than orders and left the decision largely up to state governors.
In a bright spot, big U.S. lenders rebounded 5.7% after four straight days of losses on reporting several billion dollars in reserves to cover potential loan defaults. Financial stocks were the top boost to the S&P 500.
Gilead Sciences Inc surged 8.2% following a media report that patients with severe symptoms of the disease had responded positively to its experimental drug, remdesivir.
With no treatments or vaccines currently approved for the coronavirus, the news lifted global equity markets, but Gilead said the totality of the data from the trial needed to be analyzed and that it expected to report results from a study in severe COVID-19 patients at the end of April.
“The anecdotal evidence out of Gilead’s Chicago trials for remdesivir are just that: anecdotal, even though they are part of a Phase 3 trial,” said Peter Cecchini, managing director and chief market strategist at Cantor Fitzgerald in New York.
The risk-on sentiment pushed Wall Street’s fear gauge below 40 and sent safe-haven gold tumbling almost 2%. [GOL/]
At 10:25 a.m. ET, the Dow Jones Industrial Average was up 380.07 points, or 1.61%, at 23,917.75, the S&P 500 was up 46.40 points, or 1.66%, at 2,845.95. The Nasdaq Composite was up 79.87 points, or 0.94%, at 8,612.23.
Amazon.com Inc and streaming platform Netflix Inc retreated slightly from record highs after surging this week on higher demand for online streaming services and home delivery of goods.
The world’s top oilfield services provider Schlumberger NV rose 5.4% even as it swung to a loss in the first quarter on $8.5 billion in asset writedowns and cut its dividend.
Apple Inc fell 1.9% as Goldman Sachs downgraded its stock, expecting iPhone shipments to drop 36% during the third quarter due to coronavirus-related lockdowns.
Reporting by Medha Singh and Akanksha Rana in Bengaluru; Editing by Sagarika Jaisinghani and Shounak Dasgupta