Stocks and index ETFs are mixed to higher in choppy trading Friday as traders are processing headlines that a potential coronavirus treatment could be in the works, as well as another historic surge in Covid-19 cases.
The Dow Jones Industrial Average gained 200 points, or 0.8% before pulling back some, while the S&P 500 rallied 0.4% before settling down. The Nasdaq Composite lagged is trading slightly negative on the day at -0.11% off.
Stock index ETFs are also climbing along with the underlying benchmarks, except for the Nasdaq Composite. The SPDR Dow Jones Industrial Average ETF (DIA), SPDR S&P 500 ETF Trust (SPY), are positive in late morning trade Friday, while the Invesco QQQ Trust (QQQ) is struggling to hold breakeven levels.
BioNTech’s CEO also told The Wall Street Journal the company’s coronavirus vaccine candidate could be scheduled for approval by December, causing a 6% surge in the company’s stock.
Gilead and BioNTech’s comments followed on the heels of the U.S. reporting more than 63,000 additional coronavirus cases, a record. The country’s seven-day average has now reached over 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.”
Tech stocks have been a hot item for investors for some time, helping to drive the market higher when other sectors that stood to benefit from the economy reopening, like leisure, have been ravaged.
“The path forward for the economy will likely hinge on the amount of financial scarring that occurs in the months ahead and degree of consumer engagement as coronavirus concerns fluctuate,” wrote Bruce Bittles, chief investment strategist at Baird. “High levels of initial jobless claims and evidence that small businesses are closing are sobering reminders of the economic challenges that lie ahead.”
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