Markets surge on positive data from coronavirus treatment trial

U.S. markets surged Wednesday morning after Gilead Sciences announced that there had been positive data in trials for its drug remdesivir in treating the coronavirus.

The Dow Jones Industrial Average shot up 400 points, or 1.6 percent, and the S&P 500 rose 53 points, or 1.9 percent.

Gilead announced that it was “aware of positive data emerging” from a study of the drug remdesivir at the National Institute of Allergy and Infectious Diseases, which it said was expected to provide details in an upcoming briefing.

The company also said it had more data forthcoming from another trial testing shorter five-day treatments of the drug.

Markets took the news to heart, even as the Commerce Department announced dire economic data.

The economy shrank by an annualized 4.8 percent in the first quarter, the worst quarterly contraction since the Great Recession and more than market estimates of roughly 3.9 percent.

The decline in economic activity reflects widespread lockdowns that came into effect in March, even after the first two months of the year had been expected to see normal levels of growth.

The second quarter is expected to see a much sharper contraction. The Congressional Budget Office projected that the economy would shrink at an annualized rate of nearly 40 percent from April through June.