US stocks finished little changed on Thursday as a strong rally for all three benchmarks hit a snag in afternoon trade amid reports that suggested that a closely followed experimental drug intended to be used to treat coronavirus delivered disappointing results in an “inconclusive” trial.
Meanwhile, the US Congress has passed latest economic relief package of almost $500 billion with more than $300 billion to aid for small businesses. Crude oil prices staged a recovery by more than 2% from historically low levels.
The Dow Jones Industrial Average (DJIA) eked out a gain of 39.44 points or 0.17%, at around 23,515.26, buttressed by gains of UnitedHealth Group Inc. (UNH), which rose 3% on the day. The blue-chip benchmark had hit a high at 23,885.36.
Meanwhile, the S&P 500 (SPX) edged up 1.51 points or less than 0.1% to 2,797.80 with an intraday peak at 2,844.90. The Nasdaq Composite (COMP) gave up less than a point to end the session virtually unchanged at 8,494.75.
However, the maker of the therapeutic Gilead Sciences (GILD) says that results from a trial that was mistakenly published on the World Health Organization’s website, and subsequently removed, isn’t conclusive and referred to articles about findings as “inappropriate characterizations.” Still shares of Gilead closed 4.34% lower.
June crude futures for West Texas Intermediate oil (CLM20) rocketed 20% to settle at $16.50 a barrel on the New York Mercantile Exchange while June gold futures (GCM20) finished up about 0.4% to settle at $1,745.40 an ounce with a slight decline on the early morning on Friday.
“The hope as of last week was that Gilead could take the fear of dying off the table, which would result in a much quicker, cleaner, faster recovery. If that's less likely today than it was yesterday, it is perfectly reasonable for the market to have sold off,” said David Katz, chief investment officer at Matrix Asset Advisors. The market's sensitivity to news related to coronavirus therapies reflects investors' desperation for any indication of when the global economy might be able to start returning to normal. Meanwhile, US President Donald Trump has pushed back with plans of early reopening the economy. He said that the social distancing guidelines could be extended to early summer. “I think people are going to know just out of common sense. At some point, we won’t have to do that. But until we feel safe, we’re going to be extending,” he said at a White House press briefing.
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