Friday’s Stock Market Open: US Equities Rise Despite Worries Over Covid-19 Resurgence, Oil Above $40

Update: 12:05 p.m. EDT:

U.S. stocks remained in the black as of Friday noon, although equities have pared back earlier gains.

The Dow Jones Industrial Average rose 104.55 points to 26,184.65, while the S&P 500 gained 12.22 points to 3,127.56 and the Nasdaq Composite Index climbed 61.8 points to 10,004.85.

In Europe markets finished higher, as Britain’s FTSE-100 gained 1.1%, while France’s CAC-40 climbed 0.42% and Germany’s DAX rose 0.4%.

Boston Fed President Eric Rosengren said on Friday that the Federal Reserve have seen great demand from small businesses for its lending facility.

“Of course there is a learning curve, but we are seeing tremendous interest in the loans from businesses,” he said. “Lenders are determining how they’ll participate in and communicate about the program. Borrowers will need to persist during this ramp-up phase.”

Rosengren also said U.S. businesses will need more financial support.

Original story:

U.S. stocks gained on Friday as investors cheered China’s commitment to buy U.S. farm equipment, although fears over a new wave of covid-19 cases are growing.

The Dow Jones Industrial Average jumped 304.89 points to 26,384.89, while the S&P 500 gained 34.73 points to 3,150.07 and the Nasdaq Composite Index climbed 94.92 points to 10,037.97.

China reportedly will accelerate its purchases of U.S. farm goods to satisfy requirements under the phase one trade deal following high level talks in Hawaii.

“During my meeting with [Chinese Communist Party] Politburo Member Yang Jiechi, he recommitted to completing and honoring all of the obligations of Phase 1 of the trade deal between our two countries,” U.S. Secretary of State Mike Pompeo tweeted on Thursday.

Some major states, including Texas, California, Arizona and Florida, have reported a spike in coronavirus cases, raising fears that local governments may again impose quarantine restrictions and shut down businesses.

Former Food and Drug Administration Commissioner Dr. Scott Gottlieb said on Thursday that he is worried about a resurgence of covid-19.

“These are outbreaks. We’re seeing doubling times now falling under 10 days,” Gottlieb said. “These [states] are on the cusp of getting out of control. I think these states still have a week or two to take actions to try to get these under control. I’m more concerned than I was three weeks ago heading into the fall. Unless we get comfortable taking some common sense measures, where we can, some limited measures, we’re going to be stuck with a lot more spread.”

“The rally of the past few months may have led to stocks reaching within striking distance of record highs, but investors are struggling to reconcile upward momentum and less optimistic messages about the months ahead,” said Lindsey Bell, chief investment strategist at Ally Invest. “That, along with concerns about a second wave of coronavirus and geopolitical tensions, has led to some serious indecisiveness.”

Traders were also disheartened on Thursday by news that another 1.5 million people filed for unemployment insurance last week.

“The number of new jobless claims fell for the eleventh week in a row but this week, the improvement was much smaller even compared to last week’s upwardly revised figure,” said Ken Berman of Gorilla Trades. “While the May jobs report was much better than expected, this month’s job-related indicators were far from stellar, and that could mean that the pace of the recovery is slowing.”

Overnight in Asia, markets finished higher. The Shanghai Composite climbed 0.96%; Hong Kong’s Hang Seng rose 0.73%; while Japan’s Nikkei-225 gained 0.55%.

In Europe markets traded higher, as Britain’s FTSE-100 gained 1.32%, while France’s CAC-40 climbed 1.31% and Germany’s DAX jumped 1.04%.

Crude oil futures jumped 3.48% at $40.19 per barrel, Brent crude gained 2.55% at $42.57. Gold futures rose 0.72%.

The euro rose 0.24% at $1.231 while the pound sterling slipped 0.28% at $1.2386.