Earnings from IBM, Netflix, Coca-Cola and dozens of other companies are expected this week. But with state shutdowns reaching the one-month milestone, the market is more likely to trade on virus headlines and news about reopening the economy.
There are also some important economic reports including one on existing home sales coming out on Monday and one on durable goods on Friday. And of course, the weekly jobless claims will again be the most relevant, as economists watch to see what happens once government funds reach the hands of business owners.
In the past week, stocks were higher, but there was a divergence with the Dow up just under 2.2% at 24,242, and Nasdaq, lifted by tech and biotech, surging 6%. The S&P 500 gained 3% for the week and is now 31% off its March lows.
Stocks gained amid signs the virus outbreak has peaked and news that some reopenings could start in the next few weeks.
The market also bounced Friday as early results of a Gilead drug showed promise for treatment of severe coronavirus cases.
Technology stocks were up about 4% for the week and health care was up more than 5% while consumer discretionary stocks led with a gain of more than 6%.
US Stocks Rallied Friday – Possible News of a Fast Recovery Drug
Stocks rallied near closing on Friday to notch their second-straight weekly gain after news of a possible treatment for COVID-19 and the Trump administration’s announcement of guidelines for reopening the economy late Thursday.
The Dow Jones Industrial Average rose 704.81 points, or 3%, to end the session at 24,242.49, while the S&P 500 advanced 75.01 points, or 2.7%, to 2,874.56. The Nasdaq Composite Index gained 117.78 points, or 1.4%, to close at 8,650.14.
For the week, the Dow gained 2.2%, the S&P 500 advanced 3% and the Nasdaq rose 6.1%.
Support for stocks was attributed to a report from health-care media site Stat News that indicated promising results for a drug used to treat COVID-19, the disease that has claimed more than 140,000 lives around the globe and forced the closure of much of the U.S. and global economies in an effort to contain it.
University of Chicago medical researchers saw “rapid recoveries” in 125 patients suffering from COVID-19 who were partaking inGilead Sciences Inc.’s remdesivir clinical trial, according to a Thursday night report.
The results have grabbed the attention of Wall Street because there is currently no vaccine for the potentially fatal illness, and any signs of progress toward a treatment have the potential to elicit premature euphoria from investors.
“ The market is fueled by hope and optimism today — hope for a vaccination and optimism around reopening the economy,” Mike Loewengart, managing director of investment strategy at E-Trade wrote in an email, “That said, these are relatively fragile indicators as testing remains under way and areas hard hit like New York and New Jersey continue to operate under strict stay-at-home orders.”
Sunday Night US Stock Futures
Sunday evening U.S. stock-index futures headed firmly lower due to thinly traded weekend action, as investors assessed the staggered plans for the reopening of economies all over the world.
Investors were also watching reports on the progress of obtaining additional funds for small businesses and workers hurt by the worst viral outbreak in a century.
Futures for the Dow Jones Industrial Average were off 82 points, or 0.4%, at 24,073, those for the S&P 500 index were down 9.35 points, or 0.3%, at 2,860.75, while Nasdaq-100 futures were off 14.25 points, or 0.2%, at 8,794.75.
The benchmarks are coming off a strong week, where the Dow gained 2.2%, the S&P 500 advanced 3% and the Nasdaq Composite Index put in a weekly return of 6.1% on Friday.
Investors have been paying attention for signs of peak infections in parts of the world, including New York, and kept their eye on how Europe, notably Germany, plans to end its economic pause due to the pandemic.