The View from 5th Avenue

The View at Two – 29 April 2020

A Wing and a Prayer….US markets thrive on hope and also CB stimulus. But, today has been mostly the former (until the FOMC at 2:30p, of course). Despite US GDP seeing its worse quarter since 2008 (first economic contraction since the first quarter of 2014), pending home sales being down 21% in March and Boeing announcing it would cut 16,000 jobs, markets have forged ahead on the hope that Gilead’s remdesivir really would be the answer COVID-19 patients and doctors have been looking for. The experimental drug met its primary endpoint and the biotech company's shares soared 7%. Two caveats to note:  The study did not compare the use of remdesivir to a placebo, making it difficult to reach conclusions based on the data. Also, a separate study published in The Lancet today (and leaked by WHO last  week) showed that the drug did not have significant health benefits for critically ill COVID patients.

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