Coronavirus: Stocks rise as Gilead reports 'encouraging' data on remdesivir drug

Edmund Heaphy
Finance and news reporter
A vial of the drug remdesivir, which is being trialled as a treatment for coronavirus. (Ulrich Perrey/pool/AFP via Getty Images)

Stocks rose across the world on Wednesday after Gilead Sciences (GILD) said it had seen “encouraging” results from a clinical trial of experimental drug remdesivir, which is being used to treat some severe cases of coronavirus.

The new data shows that some coronavirus patients who received a five-day course of the drug saw similar improvements to those on a 10-day course, meaning that significantly more people could be treated with the current supply of remdesivir.

“This is particularly important in the setting of a pandemic, to help hospitals and healthcare workers treat more patients in urgent need of care,” said Dr Merdad Parsey, the chief medical officer of Gilead.

The drug has not been proven to treat coronavirus, and a previous trial in China failed to show any meaningful results in COVID-19 patients.

In the US, the S&P 500 (^GSPC) was up by more than 2.1%. The Dow Jones Industrial Average (^DJI) climbed by almost 2%, while shares on the Nasdaq (^IXIC) rose by more than 2.6%.

The pan-European STOXX 600 index (^STOXX) rose by around 1%. London’s FTSE 100 (^FTSE) rose by around 2.3%.

Germany’s DAX (^GDAXI) climbed by around 1.7%, while France’s CAC 40 (^FCHI) was up by more than 1.2%.

READ MORE: US economy contracted for the first time in six years

Multiple trials of remdesivir, one of the most-watched potential coronavirus treatments, are currently being conducted.

The data released on Wednesday came from an uncontrolled trial, meaning that its results should be considered with caution.

Writing that the Gilead data was “undoubtedly positive for risk,” Neil Wilson, the chief market analyst at Markets.com, noted that “the closer you get to treatment or a vaccine the quicker we reopen the economy.”

“Rumours of positive results from Gilead a week ago helped lift spirits and this is yet more encouraging news,” he said.

Shares in Gilead rose by more than 3% on Wednesday.

The positive momentum came even after the US Bureau of Economic Analysis said that US economic growth turned negative for the first time since 2014 in the first three months of the year.

US gross domestic product contracted by 4.8% in the first quarter, worse than analysts had forecast.

The US Federal Reserve will also hold a scheduled policy meeting on Wednesday. While it is not expected to announce any major policy changes, analysts believe the bank could provide guidance on what it intends to do with its $6.6tn (£5.3tn) balance sheet.

READ MORE: Powell to face 'status check' on Fed's emergency actions

Stocks in Asia rose on Wednesday, pushing the MSCI Asia Pacific index into bull market territory, meaning it has gained 20% since its recent lows.

China’s SSE Composite Index (^SSEC) rose by more than 0.4% and the Hang Seng (^HSI) was up by more than 0.1% in Hong Kong at market close.

Japan’s Nikkei (^N225) closed marginally in the red, while the KOSPI Composite Index (^KOSPI) in South Korea climbed by 0.7%. Australia’s ASX 200 (^AXJO) rose by more than 1.5%.

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