Stocks – Wall Street Opens Higher on Reopening Hopes

A sign is seen on Wall Street near the New York Stock Exchange June 15, 2012. REUTERS/Eric Thayer — U.S. stock markets opened higher on Tuesday as the sight of more and more states relaxing lockdown measures fostered hopes of a robust rebound from the current collapse in economic activity.

By 9:35 AM ET (1335 GMT), the Dow Jones Industrial Average was up 297 points or 1.3% at 23,047 points, while the S&P 500 was up 1.2% and the Nasdaq Composite was up 1.4%.

The market was supported by strength in energy stocks as crude oil prices continued their recovery from recent lows. The lifting of lockdown measures is underpinning demand for gasoline, while a number of U.S. producers both big and small have recently announced they will lower output, contributing to the general rebalancing of supply and demand. Index heavyweights Exxon Mobil  (NYSE:XOM) stock and Chevron (NYSE:CVX) stock rose 4.9% and 3.8% respectively to test two-month highs. U.S. crude futures, meanwhile, were up 18% at $24.06 a barrel.

According to analysis by Evercore ISI, the share of Americans living under state-wide stay-at-home orders has fallen from over 90% in mid-April to only 60% as of this week, and is expected to fall to around 5% by the first week of June. 

However, that reopening comes at the risk of a fresh pickup in infection rates. The University of Washington’s Institute for Health Metrics and Evaluation has revised its estimates for the U.S. death toll from Covid-19 sharply higher on the basis of current knowledge about the timing of state reopenings. It now expects around 135,000 U.S. deaths by early August, according to The Wall Street Journal.

In a relatively busy morning for pharma stocks, Pfizer Inc (NYSE:PFE) rose 2.4% to its highest in over three months after announcing the start of human testing for its prospective coronavirus vaccine, a project it’s developing together with German-based Biontech  (NASDAQ:BNTX). Biontech stock rose 7.9%. 

Elsewhere, Regeneron (NASDAQ:REGN) stock rose 5.2% after its Dupixent treatment for eczema more than doubled sales in the first quarter, generating a better-than-expected set of results at the group level. Meanwhile, Alexion Pharmaceuticals  (NASDAQ:ALXN) stock fell 4.1% after it agreed to buy Portola (NASDAQ:PTLA) at a premium of more than 100% to its current market value.

Underperformers included car hire firm Hertz Global (NYSE:HTZ), which fell 13% after a report saying that it may file for chapter 11 bankruptcy as early as this week. Worth $15 billion in 2014 before the rise of Uber (NYSE:UBER) and Lyft (NASDAQ:LYFT), the company with nearly $10 billion in sales last year is now valued at aroumd $500 million. Uber, meanwhile, rose 5.0% after announcing it intends to discontinue the loss-making Uber Eats services in eight markets across the globe.