Stock gains accelerated Tuesday, as Gilead Sciences said its Coronavirus vaccine, Remdesivir is showing positive results in its testing phase.
All three major U.S. indices rose considerably Tuesday, with the S&P 500 up 2.9%. In the morning, the index was up just 2%. The 10 year treasury yield did slip (yields fall when prices rise) to 0.6%, as the Federal Reserve remains a large buyer of the bond in what has been largely a risk-on market of late.
Gilead Sciences (GILD) - Get Report said, contrary to perceptions about Remdesivir human testing in China, the Coronavirus vaccine is yielding positive results in the U.S. That’s a huge positive for market sentiment.
GDP for the first quarter came in at -4.8% and is expected to decline by double digit percentage points in the second quarter, all of which the market expected and is looking past, sending valuations soaring.
Google (GOOGL) - Get Report, along with other big tech stocks, rose considerably, up 8.8%. The search giant show strong advertising sales, contrary to what some had seen as a potentially disappointing ad sales quarter, as brands spend less on marketing.
The Market has had several up days on vaccine and lockdown optimism of late. With valuations stretched, some remain cautions, as they have been for weeks.
"Positive momentum amid a nasty GDP read speaks to the forward-looking nature of the markets,” wrote Mike Loewengart, head of investment strategy at E*Trade. "What may give market watchers pause though is the extent of the rally we’ve seen through April. It’s breathtaking in its ascent. Exceptionally large moves are prone to corrections, and the market rarely makes a significant low without testing it. Investors shouldn’t be caught off guard or get too discouraged by another market drop in the next few weeks.”