Wall Street started the day with massive gains across all three major averages, after positive retail sales data boosted confidence in a swifter economic recovery, and a drug trial showed “breakthrough” results for COVID-19 treatment.
The Dow Jones Industrial Average traded higher by around 850 points, with the S&P 500 up by 2.7 percent and the Nasdaq up by 2.3 percent at the opening bell.
Monthly retail sales data released Tuesday morning from the Census Bureau showed a 17.7 percent increase, the biggest jump on record. Economists were expecting a gain of around 8 percent. Data for April registered the the largest monthly drop ever, down 14.7 percent.
President Donald Trump was quick to tout Tuesday’s retail gains, tweeting just minutes after the data was released, “Wow! May retail sales show biggest one-month increase of ALL TIME, up 17.7%. Far bigger than projected. Looks like a BIG DAY FOR THE STOCK MARKET, AND JOBS!”
Stocks soared in premarket trading on news of a promising coronavirus treatment that showed increased survival rates for patients on ventilators or oxygen.
“It will save lives, and it will do so at a remarkably low cost,” Martin Landray, an Oxford University professor co-leading the trial, told Reuters.
“It is a major breakthrough,” said Peter Horby, Professor of Emerging Infectious Diseases and Global Health at the University of Oxford and co-lead on the trial.
The drug is a readily available generic steroid that has been in use for about 50 years as an anti-inflammatory.
Market attention will turn to Federal Reserve Chairman Jerome Powell later on Tuesday morning. The central bank head is set to testify before the Senate Banking Committee as part of a semiannual update on monetary policy.
Powell has taken a fairly dour tone in recent appearances and interviews, describing the coronavirus crisis as “the biggest economic shock in living memory,” and calling the impact of the millions of job losses “heartbreaking” for minorities and lower-wage earners.