U.S. Stock futures rose more than 800 points as reports of a healthcare company are testing a drug that has been showing good results against COVID-19.
Dow Jones Industrial Average futures were up 854 points, suggesting a Friday opening gain of about 841 points. S&P 500 and Nasdaq 100 futures also pointed to gains for the two indexes opening Friday (April 17).
Gilead: Remdesivir may help in flattening the curve
Stock shares of research-based biopharmaceutical company Gilead Sciences Inc. skyrocketed more than 16% in after-hours trading on Thursday, April 16.
This move was triggered after details leaked about a closely watched clinical trial of the company’s antiviral drug Remdesivir, showing promising results in treating COVID-19.
The University of Chicago conducted phase 3 of its drug trial and the results found that most of its patients had “rapid recoveries in fever and respiratory symptoms” and were discharged in less than a week.
Infectious disease specialist Kathleen Mullane said according to STAT News:
“The best news is that most of our patients have already been discharged, which is great. We’ve only had two patients perish.”
However, the outcomes show only a preview of Remdesivir’s effectiveness as other healthcare institutions have not released their results yet.
Prepare for a landslide in other sectors
Despite the positive economic outlook given by the healthcare and technology sectors, other experts see a possible drop in other industries.
In CNBC’s Mad Money on April 16, host Jim Cramer said that there are more losers than winners as he added:
“These stocks are this market’s Achilles heel, and whenever they bounce, you’ve got to sell them and swap into the winners, like the tech and health-care companies that are helping us overcome the pandemic.”
Some sectors that he mentioned were autos, oil & gas, travel, as well as commercial REITs.
Peter Boockvar, Bleakley Advisory Group chief investment officer, expects another 20% could the market as he told CNBC’s Trading Nation:
“A lot of the bad news that we’re seeing now in terms of the numbers were priced in the sharp decline from the February highs. [The range is] 2,200 on the downside which we saw in the third week of March and around the 2,800, 2,900 level that we’re kind of hoovering over right now.”
In addition, Boockvar is also worried about the greater risk to the downside as the pace of the economic recovery is going to be “extremely slow”.
However, he also sees opportunity in metals, gold & silver, which have rallied about 16% and 22% respectively.
Investors await further market developments as we approach the last day of the trading week.