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Investing.com — U.S. stock markets opened sharply higher on Friday before retracing some of their gains, as hopes for a medical breakthrough to beat the Covid-19 virus combined with further signs of economic life restarting to lift spirits ahead of the weekend.
By 10:30 AM ET (1430 GMT), the Dow Jones Industrial Average was up 368 points, or 1.6%, at 23,906 points, while the S&P 500 was up 1.6% and the Nasdaq 100 was up 0.9%.
The DJIA was lifted by news that index heavyweight Boeing (NYSE:BA) aims to partially restart production at its Washington state plant from Monday. The Nasdaq was supported by an 8.4% rise in Gilead Sciences (NASDAQ:GILD) stock, after leaked video footage of biologists discussing apparently favorable tests of its experimental drug remdesivir encouraged hopes that it could be used to treat Covid 19.
Gilead itself said that “Anecdotal reports, while encouraging, do not provide the statistical power necessary to determine the safety and efficacy profile of remdesivir as a treatment for Covid-19.” The stock pared early gains of over 10%.
The market continues to look through a strong of economic indicators and company reports that are principally historical, preferring to concentrate on evidence that the virus is peaking or has passed its peak in certain countries and regions.
“In a crisis there are only lagging indicators,” said Barings strategist Christopher Smart in emailed comments, “so the economic data will be bad at least for the next few weeks.”
“Quarterly reports will also be bad, but when Presidents, Prime Ministers, Governors and Mayors begin to plan a return to life after the Great Lockdown, markets will begin to judge where the damage has been greatest and where the recovery could come soonest.”
Among the biggest movers in early trading were AMC Entertainment, which surged over 50% after saying it had enough cash to last it through July. By that time, the world’s largest chain of movie theaters should be up and running again: under President Trump’s new three-stage guidelines, theaters will be among the first businesses allowed to open – albeit social distancing will force them to do so at much-reduced capacity.
Elsewhere, Schlumberger (NYSE:SLB) (NYSE:SLB) stock rose 5.1% after the oilfield services company said it would continue to pay 25% of its dividend instead of suspending it entirely, as feared. The company stiill posted a net loss of $7.4 billion after registering over $8 billion of impairments, as oil and gas companies across the world slash their capital spending in the low-price environment.
State Street (NYSE:STT) (NYSE:STT) stock rose 1.3% after it handily beat expectations for earnings and revenue in the first quarter thanks to the spike in market volatility that led to much higher levels of client activity.
