Stocks were mostly flat on Friday as investors wrapped up another volatile week that featured unprecedented moves in the oil market.
The Dow Jones Industrial Average traded 57 points higher, or 0.2%. The S&P 500 climbed 0.2% while the Nasdaq Composite dipped 0.1%.
Oil rose for a third consecutive day, rebounding from a historic rout that saw a futures contract turn negative for the first time ever. West Texas Intermediate crude climbed 4.2% to trade above $17 per barrel amid increasing bets for a U.S. production cut, bringing its three-day rally to more than 40%.
Still, crude prices were headed for steep weekly losses as demand concerns weigh on oil’s outlook amid the coronavirus pandemic. WTI futures have lost over 31% for the week.
“Looking ahead, it’s still all about demand for oil right now, and so far there is little evidence to support the idea that consumer growth is going to rebound anytime soon,” said Tom Essaye, founder of The Sevens Report.
The major stock averages were on track to post modest weekly losses due to a steep sell-off earlier in the week triggered by the collapse in oil markets. The Dow was down 2.8% for the week, while the S&P 500 fell 2.6%.
Stocks were taken for a wild ride on Thursday after The Financial Times reported — citing documents accidentally published by the World Health Organization — that Gilead Sciences’ drug remdesivir did not improve coronavirus patients’ condition. The documents cited by the FT referred to a Chinese clinical trial.
Gilead noted that study was “terminated early due to low enrollment,” leaving it “underpowered to enable statistically meaningful conclusions. As such, the study results are inconclusive.”
The S&P 500 and Nasdaq Composite closed just below the flatline on Thursday while the Dow eked out a small gain. At their session highs, however, the averages were all up more than 1%.
To be sure, CNBC’s Jim Cramer raised doubt over the trial conducted in China, advising investors to wait for results from U.S. studies before disregarding the treatment.
“I say wait until the American studies come out,” Cramer said in a tweet. “University of Chicago study is a lot more rigorous. I would stick with that. You don’t have to believe it…but this is the third time the Chinese have said the drug doesn’t work.”
The coronavirus outbreak has dominated market sentiment for most of 2020 as investors grapple with its economic consequences.
More than 2.6 million cases have been confirmed worldwide, according to data from Johns Hopkins University. In the U.S., over 800,000 cases have been confirmed. However, a decline in new daily cases has boosted equities from their lows reached on March 23.
The major averages have rallied more than 25% since late March, with the S&P 500 retracing about half of its downside move from the all-time high set Feb. 19.
— CNBC’s Yun Li contributed to this report.
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