US stocks rise, driven by tech sector and easing of lockdowns

United States stocks jumped on Friday as some states prepared to relax coronavirus-related stay-at-home orders and tech investors pushed Apple and Microsoft shares higher. 

The Dow Jones Industrial Average rose 1.1 percent to end the day at 23,775.27. The S&P 500 – a widely used gauge of US retirement and college savings accounts – gained 1.4 percent. The Nasdaq Composite Index added 1.7 percent.

Apple and Microsoft each climbed more than one percent, lifting the S&P 500 more than any other companies. The two tech titans are on tap to report their March-quarter results next week, giving investors a glimpse at how the pandemic has affected their global businesses.

Shares of Boeing Co fell more than six percent after a report the planemaker was planning to cut 787 Dreamliner output by about half.

All of the 11 S&P 500 sector indexes moved up, with information technology jumping 2.1 percent and materials rallying 1.5 percent.

Even with Friday’s gains, the Dow lost 1.9 percent of its value for the week, while the S&P 500 dropped more than 1 percent. The Nasdaq ended the week 0.2 percent lower.

Investors worry about how the US economy will fare given a deep economic slump following a near-crash in April business activity and weekly jobless claims totalling 26 million in just five weeks.

The index has recovered more than 25 percent from its March low, and expectations are growing that more businesses will be allowed to reopen as coronavirus infections show signs of peaking.

Georgia became the first state to push ahead with its plan to allow an array of small businesses to reopen on Friday despite disapproval from US President Donald Trump and health experts.

Investors may be overestimating how quickly US businesses can go back to normal, and the S&P 500 could fall five percent or more as it becomes evident that resuming normal economic activity may not happen for months, warned Eric Freedman, chief investment officer at US Bank Wealth Management in North Carolina.

“We think this is likely to be a little bit of a sideways market, and we won’t be surprised to see a bit of downside before we see more upside,” Freedman said.

Amazon rose 0.4 percent to a record high close ahead of its quarterly report on Thursday. With online shopping booming as people avoid traditional stores, Amazon’s stock market value has ballooned by over $100bn since February 19, just before coronavirus fears gripped Wall Street.

US crude futures contracts were up 2.7 percent to settle at $16.94 per barrel. There are hopes the US may shrink production to make up for diminished demand and storage capacity. West Texas Intermediate futures contracts fell more than 30 percent for the week.