Stocks rose Friday as news about a potential coronavirus treatment increased hope for an economic recovery following the outbreak. Tech stocks also continued their winning week.
The Dow Jones Industrial Average traded 369.21 points higher, or 1.4%, to 26,075.30. The S&P 500 climbed 1%, or 32.99 points, to 3,185.04. The Nasdaq Composite rose 0.6%, or 69.69 points, to another record closing high of 10,617.44, lifted by Amazon and Netflix.
Gilead Sciences said its coronavirus treatment candidate, remdesivir, showed an improvement in clinical recovery and a 62% reduction in the risk of mortality compared with standard care. The news sent Gilead shares up more than 2%. BioNTech's CEO also told The Wall Street Journal the company's coronavirus vaccine candidate could be ready for approval by December.
Shares of companies that would benefit from the economy reopening outperformed. American Airlines and United popped 6.8% and 8.2%, respectively, while Delta traded 5.6% higher. Cruise operator Carnival surged 10.8% after the company said it can break even in cash flow with capacity between 30% and 50%.
Netflix jumped 8% to a record after Goldman said it now sees a 30% rally over the next 12 months for the company. Amazon also gained 0.5% to an all-time high after Citi hiked its target on the e-commerce giant to a Street high of $3,550 per share.
JPMorgan was the biggest gainer in the 30-stock Dow, jumping 5.4%. Dow-component Goldman Sachs rose 4.4%. Meanwhile, Citigroup and Wells Fargo rallied 6.4% and 5.9%, respectively. Big banks are set to kick off earnings season next week.
"On days in which there's promise of health solution, or that the economy might actually recover faster than expected, you tend to get all your cyclical stocks ... leading the charge," said Michael Arone, chief investment strategist for State Street Global Advisors. Conversely, "when it looks like the economy is going to stall, or the recovery will be slower than expected, investors tend to go back to the old growth stalwarts of technology."
Friday's gains put the Dow up 0.9% for the week. The S&P 500 and Nasdaq were up 1.7% and 4% in that time period. For the year, the Dow and the S&P 500 are down 8.6% and 1.4%, respectively, while the Nasdaq is up more than 18%.
To be sure, some investors remain concerned as new coronavirus cases continue to pile up. The U.S. reported Thursday more than 63,000 additional coronavirus cases, a record. The country's seven-day average now stands at more than 53,000 cases.
"For the US, the outlook is bleak – the COVID crisis continues to metastasize as transmissions stay elevated while hospitalizations and fatalities rise too," said Adam Crisafulli of Vital Knowledge, in a note. "While US bulls hang on to 'Amazon, a vaccine, and the Fed' and those three items will prevent a steep decline, it's very hard to look at the SPX and find it near-term compelling."
— CNBC's Yun Li contributed reporting.
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