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Stock Market News for May 6, 2020

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Benchmarks ended higher on Tuesday after healthcare stocks jumped on reports of progress in coronavirus vaccine. Investors also cheered oil prices surge due to several countries and American states preparing to ease coronavirus-induced restrictions to revive their economies.

The Dow Jones Industrial Average (DJI) rose 133.33 points, or 0.6%, to close at 23,883.09 and the S&P 500 gained 0.9% to close at of 2,868.44. While, the Nasdaq Composite Index closed at 8,809.12, adding1.1%. The fear-gauge CBOE Volatility Index (VIX) decreased 6.6%, to close at 33.61. Advancing issues outnumbered declining ones for 2.77-to-1 ratio on the NYSE and a 2.01-to-1 ratio on the Nasdaq favored advancers.

How Did the Benchmarks Perform?

All the 11 major sectors of the S&P 500 ended in positive, with Health care and tech leading as the best-performing sectors and rising more than 1%. Tech stocks continued their Monday’s rally and gains in Microsoft Corporation MSFT, Apple Inc. AAPL and Amazon.com, Inc. AMZN lifted the broad market out of negative territory.

Overall, the S&P index recorded 9 new 52-week highs and no new lows. Meanwhile, Nasdaq recorded 43 new highs and 4 new lows.

COVID-19 Vaccine Trails Lift Wall Street

So far more than 3.7 million people have been infected by the novel coronavirus across the globe. With countries under lockdown, economies suffer and stock markets have hit lows in the past few months. However, reports of progress in development of vaccine have lifted sentiment in the past few days.

On Tuesday, researchers at New York University and the University of Maryland School of Medicine said that they have began injecting people with the first of four vaccine candidates from Pfizer Inc. PFE and BioNTech SE BNTX.

Along with that Regeneron Pharmaceuticals, Inc. REGN also announced that their experimental antibody cocktail for COVID-19 may be available for use by fall. Shares of Pfizer and BioNTech closed 2.4% and 9.2% higher, respectively.

Mixed Quarterly Earnings

On Tuesday investors also kept close watch on quarterly earnings results as some companies reported better-than-expected earnings but some face the brunt from coronavirus-led lockdowns.

Shares of Regeneron Pharmaceuticalsjumped 6% after the company reported first quarter earnings of $6.60 per share, surpassing the Zacks Consensus Estimate of $5.73. The company’s total revenues in the reported quarter jumped 33% year over year to $1.8 billion, while beating the Zacks Consensus Estimate of $1.7 billion.The year-over-year growth was driven by strong Eylea and Dupixent sales. (Read More)

Shares of Wayfair Inc. W jumped 23.7% after the company reported quarterly loss of $2.30 per share versus the Zacks Consensus Estimate of a loss of $2.55. The company posted revenues of $2.33 billion for the quarter ended March 2020, missing the Zacks Consensus Estimate by 0.36%. The estimates topped as quarantined consumers bought more office furniture, kitchen appliances, and cookware products. (Read More)

Wayfair flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Oil Price Soar for Fifth Straight Day

On Tuesday, oil prices rose on hopes that the economic downturn reached its low point, helping stocks rally 20%. Market grew optimistic around ongoing production cuts and a recovery in demand with the reopening of economies worldwide, which helped push prices higher. Crude price gained for the fifth-straight day and prices are up 30% so far in May.

The West Texas Intermediate jumped 20.45%, or $4.17, to settle at $24.56 per barrel and Brent settled 13.86% higher at $30.97 per barrel. Shares of Chevron Corporation CVX jumped 1.6% on May 5.

US Service Sector Declines

The ISM nonmanufacturing index dropped to 41.8 in April from 52.5 in March, which is the sector’s biggest contraction since March 2009. April’s steep decline was driven by the lowest amount of business activity, due to the coronavirus-led stay at home orders and closure of nonessential businesses.

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