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Stock market gives up gains after negative remdesivir report
23-Apr-20 16:20 ET
Dow +39.44 at 23515.26, Nasdaq -0.63 at 8494.76, S&P -1.51 at 2797.80

https://www.briefing.com/stock-market-update

[BRIEFING.COM] The S&P 500 advanced as much as 1.6% on Thursday after the number of weekly initial claims declined to about 4.4 million, but stocks gave up gains following a negative report regarding a potential COVID-19 treatment. The benchmark index finished just below its flat line with a 0.1% decline.

The Dow Jones Industrial Average (+0.2%) and Nasdaq Composite (unch) also closed little changed, while the Russell 2000 (+1.0%) outperformed.

The Financial Times reported that Gilead's (GILD 77.78, -3.53, -4.3%) remdesivir drug flopped in its first randomized clinical trial in China, according to draft documents published accidentally by the World Health Organization (WHO). The news unnerved the market, and wiped out gains, as Stat News reported last Friday that the drug showed promising signs in one Chicago trial.

Gilead defended the results, saying WHO had an inappropriate characterization of the study and the data still suggested the drug had a "potential benefit," according to Stat News. Shares of Gilead still declined, and the broader market struggled the rest of the session, as the report reminded investors of the medical breakthroughs still needed to restore consumer confidence.

The S&P 500 sectors finished mixed with six closing higher and five closing lower. The energy sector (+3.0%) outperformed amid a 21.7% spike in WTI crude futures ($16.80/bbl, +3.00), which are now up 45% since Tuesday's settlement price. The utilities (-1.8%), real estate (-1.2%), and consumer staples (-1.0%) sectors underperformed.

As for the jobs data, initial claims for the week ending April 18 decreased by 810,000 to 4.427 million (Briefing.com consensus 4.0 million), which helped the market's thinking that the worst of the labor market data might be in the past.

The latter can be rationalized by states getting ready to reopen their economies, but it likely won't be as swift as the market's month-long rally. Illinois, for instance, extended its stay-at-home order through the end of May.

On the earnings front, Union Pacific (UNP 152.29, +5.19, +3.5%), Eli Lilly (LLY 159.93, +3.22, +2.1%), and CSX (CSX 64.47, +0.58, +1.0%) stood out with positive results and/or guidance.

U.S. Treasuries traded near their flat lines during the session. The 2-yr yield increased one basis point to 0.22%, while the 10-yr yield declined one basis point to 0.61%. The U.S. Dollar Index increased 0.1% to 100.50.

Reviewing Thursday's economic data:

Initial claims for the week ending April 18 decreased by 810,000 to 4.427 million (Briefing.com consensus 4.0 million). Continuing claims for the week ending April 11 increased by 4,064,000 to 15.976 million (a record high).
The key takeaway from this report, which covers the period in which the survey for the April Employment Situation Report was conducted, is that it presents some hope that the peak of the layoffs following the COVID-19 shutdowns has passed. Nonetheless, it is also a reminder of how bad things are on the labor front.
New home sales decreased 15.4% m/m in March to a seasonally adjusted annual rate of 627,000 units (Briefing.com consensus 655,000) from a downwardly revised 741,000 (from 765,000) in February. On a yr/yr basis, new home sales, which are counted when a contract is signed, were down 9.5%.
The key takeaway from the report is that it isn't as bad as feared, although COVID-19 shutdown issues didn't ramp up until the latter half of the month, which is harbinger presumably of decidedly weaker activity in April.

Looking ahead, investors will receive Durable Goods Orders for March and the revised University of Michigan Index of Consumer Sentiment for April on Friday.

Nasdaq Composite -5.3% YTD
S&P 500 -13.4% YTD
Dow Jones Industrial Average -17.6% YTD
Russell 2000 -27.2% YTD

Market Snapshot
Dow 23515.26 +39.44 (0.17%)
Nasdaq 8494.76 -0.63 (-0.01%)
SP 500 2797.80 -1.51 (-0.05%)
10-yr Note +2/32 0.602
NYSE Adv 1757 Dec 1104 Vol 1.1 bln
Nasdaq Adv 1931 Dec 1256 Vol 3.7 bln

Industry Watch
Strong: Energy, Industrials
Weak: Consumer Staples, Real Estate

Moving the Market

-- Stocks pare gains on disappointing Remdesivir update

-- Weekly initial claims decreased by 810,000 to 4.427 million (Briefing.com consensus 4.0 million).

-- WTI crude futures spike 25% to $17/bbl

WTI crude futures rise 22%
23-Apr-20 15:25 ET
Dow +59.68 at 23535.50, Nasdaq +5.71 at 8501.10, S&P +0.94 at 2800.25

[BRIEFING.COM] The S&P 500 is trading near session lows with a 0.1% gain. The Russell 2000 is up 1.8%.

One last look at the S&P 500 sectors shows energy (+3.2%), industrials (+0.8%), and health care (+0.8%) atop the standings, while the utilities (-1.8%) and real estate (-1.1%) sectors extend losses.

WTI crude futures settled higher by $3.00 (+21.7%) to $16.80/bbl. Including today's finish, WTI futures are now up 45% since Tuesday's settlement price.