'The Worst Is Over'

By Alex Eule |  Monday, April 13

Split Decision. Investors spent most of last week looking around the corner to a peak in Covid-19 cases. Today, they got the best indication yet. "The worst is over," New York Gov. Andrew Cuomo said at his daily briefing.

The Dow Jones Industrial Average responded with a 329-point decline, or 1.4%, while the S&P 500 fell 1%. Much of the improving news around coronavirus was already baked in.

Even some early positive data on the effectiveness of a potential Covid-19 treatment from Gilead Sciences couldn't do much to help stocks, though Gilead itself finished the day up 2.4%. Here's what Josh Nathan-Kazis wrote on Barrons.com:

New data on 53 Covid-19 patients treated with Gilead Sciences’ remdesivir may raise hopes for the success of continuing trials, but isn’t conclusive enough to show whether the experimental drug can help people survive serious cases of the disease.

As public officials begin to think about re-opening the economy, an effective Covid-19 treatment is becoming ever more important. Results from more rigorous clinical studies of remdesivir are likely to come out in the next few days, Josh notes. A surprise -- positive or negative -- could have a significant impact on the market's next move. 

Oil futures had a volatile day after a landmark agreement between the world's largest oil-producing nations to cut supply. Crude finished the day down 35 cents, or 1.5%, to $22.41 a barrel. 

One bright spot Monday came from the tech sector, where chip stocks like Advanced Micro Devices, Intel, and Nvidia all rallied. Investors are  betting that an extended stay-at-home stretch will continue to boost demand for PCs and servers in the cloud. 

A popular basket of stay-at-home stocks also had strong days. Peloton Interactive was up 12.4%, Zoom Video Communications was up 9.2%, Netflix was up 7%, and Amazon.com rose 6.2%. 

Amazon said Monday that it was planning to bring on another 75,000 employees. That's in addition to the 100,000 it has already hired in the last month, Eric Savitz notes on Barrons.com. The company is looking for ways to bring back its capacity to deliver "nonessential" items.

Shares of the e-commerce giant finished the day at 2,168.87. That's less than two points from their all-time high reached on Feb. 19, the same day the S&P 500 peaked. Since then, the broad market has tumbled 18%; Amazon is back to flat.  

Tech's strong day helped push the Nasdaq Composite into positive territory. It ended up 0.5%. The last time the Nasdaq closed higher on a day the S&P 500 was down over 1% was in October 2008.