NEW YORK (AP) – In Wall Street’s tug of war between hope and pessimism about the coronavirus pandemic, hope is fighting back.
U.S. stocks joined a worldwide rally Friday and closed out their first back-to-back weekly gain since the market began selling off two months ago. The S&P 500 jumped 2.7% for the day, following up on even bigger gains in Europe and Asia.
Investors latched onto several strands of hope about progress in the fight against the coronavirus. They included the White House’s release of guidelines for states to reopen their economies and a very early but encouraging report on a possible treatment for COVID-19. Those events dovetailed with recent numbers that raised hopes for a leveling off of infections in some of the world’s hotspots.
The gains came even as data piles higher showing the severe economic and human toll of the outbreak. The virus has killed more than 150,000 worldwide and forced the formerly high-flying Chinese economy to shrink a crunching 6.8% last quarter. A measure of leading economic indicators in the U.S. plunged last month by the most in its 60-year history, the latest in a string of similarly unprecedented data reports.
The S&P 500 rose 75.01 points to 2,874.56. The Dow Jones Industrial Average jumped 704.81, or 3%, to 24,242.49, and the Nasdaq added 117.78, or 1.4%, to 8,650.14.
The S&P 500 fell about 33% from it’s all-time high on Feb. 19 to March 23 as the virus moved quickly from Asia to Europe to the U.S., largely shutting down economies as it went. The market has recovered a little more than half of those losses since.
Pessimists say the recent rally for stocks has been overdone and point to the severe pain shocking the health care system and the economy. They say conditions are unlikely to get back to anything approximating “normal” soon.
Among the wisps of optimism that investors were focusing on Friday:
— A news report cited early progress in a drug candidate for the virus. Analysts cautioned that the encouraging data was only anecdotal, and they were hesitant to put too much stock in it. Shares of the company behind the candidate, Gilead Sciences, surged 9.7%.
— Boeing said late Thursday that it will resume production of passenger jets in Washington state next week. It suspended work late last month after workers tested positive for the coronavirus. Its 14.7% surge was a big reason for the Dow’s climb Friday.
In a sign of a bit less caution in the market, Treasury yields ticked higher but remain extremely low. The yield on the 10-year Treasury rose to 0.64% from 0.61% late Thursday, though it remains well below the 1.90% level it was near at the start of the year. Bond yields drop when their prices rise, and investors tend to buy Treasurys when they’re worried about the economy.
The market’s gains were widespread Friday, across all 11 sectors that comprise the S&P 500. Energy producers and banks led the way, a sharp turnaround from their laggardly ways earlier in the week when worries about the economy were at the forefront.
In European trading, the CAC 40 in Paris rose 3.4%, while Germany’s DAX climbed 3.1%. Britain’s FTSE 100 added 2.8%.
Japan’s Nikkei 225 index jumped 3.1%, the Hang Seng in Hong Kong advanced 1.6% and South Korea’s Kospi leaped 3.1%.
India’s S&P BSE 100 rose 2.8% after the central bank cut its benchmark interest rate to help the stalled economy and ease financing troubles amid a nationwide lockdown to fight the pandemic.