STOCKS CLIMB ON ENCOURAGING DRUG NEWS -- S&P 500 APPROACHES 200-DAY AVERAGE -- GOOGLE AND FACEBOOK LEAD XLC HIGHER -- XLY NEARS ITS 200-DAY LINE

S&P 500 NEARS TEST OF 200-DAY AVERAGE...A positive report by Gilead Sciences on its Covid-19 drug helped stocks get off to a strong start today.  The biotech stock is up 3% this morning on that report.    Chart 1 shows the S&P 500 gaining more than 2% this morning and moving closer to a test of its 200-day moving average (red arrow).  The Nasdaq Composite is doing even better as large tech stocks are off to a strong start.  Nine sectors are gaining today led by communications, energy, technology, financials, materials, and consumer cyclicals.      Internet stocks are helping make communication services the day's strongest sector.  Led by Alphabet and Facebook.

GOOGLE AND FACEBOOK LEAD INTERNET STOCKS HIGHER...Chart 2 shows the Communication Services Sector SPDR (XLC) gaining 4% this morning and nearing a test of its 200-day line. It's being led higher by two large Internet stocks in particular.  Chart 3 shows Alphabet (GOOGL) jumping 8% to the highest level in nearly two months; and rising back above its 200-day moving average.  The stock is reacting to a rise in first quarter revenue reported after the close last evening.   Chart 4 shows Facebook (FB) gaining 6% this morning and also rising above its 200-day moving average.  Facebook reports earnings today.   So does Microsoft.   While Amazon and Apple report earnings tomorrow.   Those five big tech stocks account for 20% of the S&P 500; and all five are gaining today.

CONSUMER DISCRETIONARY SPDR NEARS 200-DAY LINE...Chart 5 shows the Consumer Discretionary SPFR (XLY) also approaching a test of its 200-day line.  It's getting a boost from Amazon.com which is its biggest holding and is up more than 2% today.  But it's also being supported by formerly weak groups like cruise lines and hotel stocks which are starting to rebound.  As well as homebuilding stocks which are having a strong week.

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