Stocks rose on Friday as oil prices clawed back even more of their historic losses from earlier in the week while investors weighed the prospects of a potential coronavirus treatment from Gilead Sciences.
The Dow Jones Industrial Average closed 260.01 points higher, or 1.1%, at 23,775.27. The S&P 500 gained 1.4% to close at 2,836.74 while the Nasdaq Composite advanced 1.7% to 8,634.52. Tech was the best-performing sector in the S&P 500, gaining 2.1% as Apple climbed over 2%.
For the week, however, the Dow was down 1.9% while the S&P 500 dropped over 1%. The Nasdaq was down 0.2% week to date. It was Wall Street's first weekly decline in three.
U.S. crude futures rose 2.7% to settle at $16.94 per barrel amid hopes the U.S. will reduce some of its production to account for shrinking demand and storage capacity. Still, West Texas Intermediate futures were down over 30% week to date as traders dumped oil in historic fashion. On Monday, the WTI futures contract for May expiration traded at a negative price for the first time ever.
"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.
Wall Street was coming off a wild ride on Thursday, sparked by a Financial Times report that said Gilead Sciences' drug remdesivir did not improve coronavirus patients' condition. The FT cited documents accidentally published by the World Health Organization regarding 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 back-and-forth led to the evaporation of a solid upward move and the major averages closed flat on Thursday.
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 dismissing 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."
On Friday, Reuters reported that a U.S. government-led trial of remdesivir was running ahead of schedule. The report said those results could be ready by mid-May, with preliminary numbers possibly out earlier. Gilead shares gained more than 2% on the back of the report.
The coronavirus outbreak has dominated market sentiment for most of 2020 as investors grapple with its economic consequences.
More than 2.7 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.
The pandemic has also led to unprecedented fiscal and monetary stimulus, including an open-ended asset-purchase program from the Federal Reserve. On Friday, President Donald Trump signed a $484 billion relief bill to boost small businesses and hospitals.
"The market is getting used to the fact that maybe it's going to be late May, maybe June," before the economy is re-opened, said Daniel Deming, managing director at KKM Financial. "So the question underneath this market is whether there is enough stimulus, enough liquidity to continue to support this market structure."
"At this point the market appears to be OK with that, but if we all of a sudden get into the middle of May and it looks like it's July or August [before a re-opening], that will be another issue for the market to deal with," Deming said.
— CNBC's Yun Li contributed to this report.
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