Dow Rebounds as Energy Rides Oil Surge Higher, but Virus Spread Curbs Gains
By Yasin Ebrahim
Investing.com – The Dow rose on Thursday, led by rebound energy stocks amid a surge in oil prices and a rally in tech, but gains were kept in check by the ongoing coronavirus pandemic.
The Dow rose 0.95% after falling to its worst slump in three years a day earlier. The
S&P 500 rose 0.66% and the Nasdaq Composite added 2.30%.
Following its biggest rout since 2002, oil prices had their biggest gain on record, settling 23.8% higher, though some warn upside is limited amid ongoing demand headwinds from falling travel demand.
Global oil demand "will decline in the short-term much more quickly due to the lockdown in more and more countries around the globe," Commerzbank (DE:CBKG) said in its Commodities Daily report.
Against concerns over the spread of the novel coronavirus, which had infected more than 10,000 people in the U.S., President Donald Trump said the Food and Drug Administration had approved severe arthritis and malaria drugs, hydroxychloroquine and chloroquine respectively, for use against the virus.
A day after a sharp decline in tech, investors jumped into tech stalwarts such as Facebook (NASDAQ:FB), Amazon (NASDAQ:AMZN), and Netflix (NASDAQ:NFLX), helping the broader market clawed back some of its losses from a day earlier. Apple (NASDAQ:AAPL), however, closed down 1.6%.
Chip stocks were also in demand, with the Philadelphia Semiconductor Index up 4.2%.
Airlines were an exception to rally, with American Airlines (NASDAQ:AAL) down 11.6%, Delta Air Lines (NYSE:DAL) was down 8.43% and United Airlines (NASDAQ:UAL) was down 0.5% as the industry looks set for precarious future without a government bailout.