Dow futures were over 200 points lower Thursday after a crush of corporate earnings and jobless claims that topped 30 million in recent weeks. Also closely watched on Wall Street, depressed U.S. oil prices added another 15% early Thursday after settling up 22% in the New York session on Wednesday. The Dow Jones Industrial Average surged 532 points, or 2.2%, on Wednesday after positive data from two coronavirus drug trials of Gilead Sciences' remdesivir.
The S&P 500 jumped over 2.6% on Wednesday, and with one day left in April the index was up 13.7%, tracking for its best month since October 1974. The Dow was on pace for its best month since January 1987. While still about 17% away from its February record, it gained 35% from its March coronavirus low. The S&P 500 remained just over 13% from its February all-time high but rose 34% since its March low.
Jobless claims are continuing to soar at an unprecedented pace, with more than 3.8 million Americans filing for first-time unemployment benefits last week. The total number of claims from furloughed and laid off workers exceeded 30 million in the latest six-week reporting period. As of last week's data, all the job gains since the Great Recession were wiped out. The Federal Reserve, following its two-day April meeting and already embarking on historic stimulus measures, pledged to keep interest rates near zero until full employment and inflation return. Central bankers also promised further action to support the economy if needed.
The deluge of companies reporting financial results from the first three months of the year continued Thursday morning, with Twitter reporting better-than-expected first-quarter earnings and revenue despite an expected hit to its online ad business due to the coronavirus crisis. Monetizable daily active users also exceeded estimates. Tech giants Apple and Amazon are set to report earnings Thursday afternoon.
Dow stock McDonalds on Thursday morning reported mixed first-quarter results, missing estimates on the bottom line as coronavirus mitigation measures forced a shift to drive-thru, delivery and takeout only. However, the fast-food chain beat expectations on revenue. McDonalds said it's suspending its stock buyback program, boosting its cash position and reducing planned capital expenditures.
American Airlines lost more than $2.2 billion in the first three months of the year — its biggest quarterly loss since 2008 —as the pandemic drove down demand for air travel. On a per-share basis, American reported a worse-than-expected loss and disappointing revenue. U.S. airline travel volumes have dropped about 95% in recent weeks from a year earlier as travelers stay home.
Tesla CEO Elon Musk lashed out at state stay-at-home orders as "fascist" in an expletive-laced rant on the electric auto maker's earnings call Wednesday. Musk called shelter-in-place measures "forcibly imprisoning people in their homes against all their constitutional rights" and "breaking people's freedoms in ways that are horrible." Tesla put near-term earnings guidance on hold after posting an unexpected first-quarter profit and slightly better-than-expected revenue.
Facebook CEO Mark Zuckerberg said on the social network's Wednesday evening earnings call that he remains concerned that the economic fallout of the coronavirus crisis will last longer than people think. Facebook reported lower-than-expected first-quarter earnings but it beat on revenue, saying online advertising sales stabilized in recent weeks after a significant downturn.
Dow stock Microsoft said the Covid-19 outbreak had minimal impact on revenue, and it saw increased business in a number of its cloud-based segments. The tech giant reported better-than-expected fiscal second-quarter earnings and revenue. Other significant developments in the quarter included the unveiling of new Surface devices and the announced acquisition of data migration start-up Mover.
President Donald Trump said the federal government will not be extending its coronavirus social distancing guidelines once they expire Thursday, even as U.S. coronavirus cases push past 1 million and deaths approach 61,000. A number of states are going forward with reopening parts of their economies despite warnings from health experts that it's too early for such moves. California, which saw its beaches and parks packed in last weekend's heat wave, plans to close them down, starting Friday. Globally, reported Covid-19 cases exceed 3.2 million, with 227,970 deaths.