por admin » Vie Jul 10, 2020 2:48 pm
Dow jumps 350 points on virus treatment hope, Netflix leads Nasdaq to another record
PUBLISHED THU, JUL 9 20206:00 PM EDTUPDATED 5 MIN AGO
Fred Imbert
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Stocks rose after positive news on a Covid-19 treatment —Here’s what three experts are saying about the markets
Stocks rose Friday as news about a potential coronavirus treatment increased hope for an economic recovery following the outbreak.
The Dow Jones Industrial Average traded 350 points higher, or more than 1%. The S&P 500 climbed 0.9%. The Nasdaq Composite rose 0.5% to another all-time high, lifted by Amazon and Netflix.
Gilead Sciences said its coronavirus treatment candidate, remdesivir, “was associated with an improvement in clinical recovery and a 62 percent reduction in the risk of mortality compared with standard of care.” The news sent Gilead shares up more than 1%. BioNTech’s CEO also told The Wall Street Journal the company’s coronavirus vaccine candidate could be ready for approval by December. The company’s U.S.-listed shares rose 5%.
Shares of companies that would benefit from the reopening outperformed. American Airlines and United gained more than 6% each. Delta traded 5.9% higher. Southwest jumped 5.2%. Cruise operator Carnival surged 9.4% after the company said it can break even in cash flow with capacity between 30% and 50%.
Netflix jumped more than 8% to a record after Goldman said it now sees a 30% rally over the next 12 months for the company. Amazon also gained 0.5% to an all-time high after Citi hiked its target on the e-commerce giant to a Street high of $3,550 per share.
Goldman Sachs was the biggest points contributor in the Dow, rising more than 4% and accounting for 56 points of the average’s total gains. Citigroup and Wells Fargo advanced more than 5% each.
“On days in which there’s promise of health solution, or that the economy might actually recover faster than expected, you tend to get all your cyclical stocks ... leading the charge,” said Michael Arone, chief investment strategist for State Street Global Advisors. Conversely, “when it looks like the economy is going to stall, or the recovery will be slower than expected, investors tend to go back to the old growth stalwarts of technology.”
Friday’s gains put the Dow up 0.9% for the week. The S&P 500 and Nasdaq were up 1.7% and 3.9% in that time period. For the year, the Dow and the S&P 500 are down 3.4% and 0.2%, respectively, while the Nasdaq is up more than 5%.
To be sure, some investors remain concerned as coronavirus cases continue to pile up. The U.S. reported Thursday more than 63,000 additional coronavirus cases, a record. The country’s seven-day average now stands at more than 53,000 cases.
“For the US, the outlook is bleak – the COVID crisis continues to metastasize as transmissions stay elevated while hospitalizations and fatalities rise too,” said Adam Crisafulli of Vital Knowledge, in a note. “While US bulls hang on to ‘Amazon, a vaccine, and the Fed’ and those three items will prevent a steep decline, it’s very hard to look at the SPX and find it near-term compelling.”
— CNBC’s Yun Li contributed reporting.
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