Stocks were flat on Wednesday after back-to-back gains as investors weighed the prospects of reopening the economy along with a dismal report on U.S. payrolls.
The Dow Jones Industrial Average traded 7 points lower, or 0.03%, after jumping more than 100 points. The S&P 500 was up just 0.1%. The Nasdaq Composite outperformed, advancing 0.7%.
Big tech stocks such as Facebook and Netflix rose 1.4% and 2.3%, respectively. Amazon and Alphabet each rose 0.8% while Apple traded 1.7% higher.
Stocks were also kept in check as crude prices reversed course to trade more than 4% lower. West Texas Intermediate futures were coming off a five-session winning streak and are up about 28% for May. Those losses in oil prices led to a 1.4% drop in the S&P 500 energy sector. Occidental Petroleum, Marathon Petroleum and National Oilwell Varco all dropped more than 2%.
President Donald Trump acknowledged on Tuesday that "there'll be more death" from coronavirus but argued that not reopening businesses would also cost people their lives in other ways such as drug overdoses and suicides.
California will permit clothing stores, bookstores and flower shops to reopen for curbside pickup as soon as Friday while New York plans to ease restrictions on manufacturers, construction, and select retailers next week. This easing of restrictions has led investors to bet that the economy will restart in the near future.
"The market is enjoying the economy opening, albeit on a phased-in schedule but that more and more states are opening," Quincy Krosby, chief market strategist for Prudential Financial told CNBC. "The numbers in terms of new cases remain at a level that does not, at this point, suggest that the opening is causing cases to rise."
The fast-spreading coronavirus — which has inflected at least 1.2 million Americans and killed more than 70,000, according to Johns Hopkins University — has seen a leveling off of news cases in the U.S.
However, recent economic data continues to show the economic damage being dealt by the virus and the shutdown of the economy. A report from ADP and Moody's Analytics showed private payrolls were cut by 20.2 million last month. That was the worst report in the data series' history. Still, it was not as bad as a Dow Jones estimate of 22 million job losses.
"This is what you get when government forces business to close and consumers are fearful to go outside," said Peter Boockvar, chief investment officer at Bleakley Advisory Group. "We know however that as things reopen, many of these jobs will get restored but certainly to not anywhere near where they stood in February."
"Let's be honest, this is a healing process that is going to take years," he said.
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Stocks are flat, but big tech stocks see continued strength - CNBC
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