Stocks reversed earlier losses on Friday to end the session slightly higher, as investors continued to weigh grim economic data and earnings against hopes of a speedy economic reopening.

After the Commerce Department reported that April retail sales plunged at a startling rate of 16.4% — the worst ever monthly read — Wall Street opened to the downside. However, investors have been pricing in the gradual relaxation of stay-at-home orders that have suffocated the economy, helping the Dow to gain about 60 points after posting triple-digit losses earlier.

Nevertheless, it was hard to understate the drop in retail sales, which reflected weakness across all major store categories — except online platforms, which posted an 8.4% jump. The worse than expected retail sales figures led a number of economists to estimate an even larger than previously anticipated hit for second-quarter growth in gross domestic product (GDP).

Economists at Barclays now expect GDP to fall by 42% on an annualized basis in the second quarter, or two percentage points worse than their earlier forecast.

Grim consumer spending has been amplified by the unprecedented loss of jobs, highlighted by the latest report on initial unemployment claims, which on Thursday showed a greater than expected 2.981 million Americans filed for first-time unemployment benefits last week. This brought the total number of new claims filed since the week ended March 20 to nearly 36.5 million.

A flare-up in U.S.-China tensions also contributed to pressure on equities, with the U.S. Commerce Department tightening rules to stem Chinese telecommunication company Huawei’s access to chips made by U.S. companies.

A steady drumbeat of grisly economic data – along with weak corporate earnings results for the last reported quarter – compelled a number of analysts to strike a more cautious tone on the stock market. The S&P 500 has risen more than 25% from its March 23 low, in spite of this historically weak data, with investors betting on more stimulus from fiscal and monetary policymakers to blunt the economic fallout from the pandemic.

Meanwhile, states across the nation and some countries around the world have begun, or have discussed, a phased reopening of businesses as case growth slows for the coronavirus outbreak. The U.S. Centers for Disease Control and Prevention issued new guidance to inform states how to reopen public spaces including bars, restaurants and offices.

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4:03 p.m. ET: Stocks reverse earlier losses to close higher

Stocks closed in positive territory Friday, led by advances in the Communication Services and Consumer Discretionary sectors in the S&P 500. In the Dow, The Walt Disney Company and The Home Depot led advances, with each stock rising more than 2%.

Here’s where the three major indices settled at the end of Friday’s session:

• S&P 500 (^GSPC): +11.2 points (+0.39%) to 2,863.7

• Dow (^DJI): +60.08 points (+0.25%) to 23,685.42

• Nasdaq (^IXIC): +70.84 points (+0.79%) to 9,014.56

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12:50 p.m. ET: Stocks hold lower

Stocks were lower as Friday’s session rolled on, though the three major indices pared some earlier losses. The Utilities and Real Estate sectors led declines in the S&P 500. Raytheon and Intel underperformed in the Dow.

Here were the main moves in markets, as of 12:50 p.m. ET:

• S&P 500 (^GSPC): -10.59 points (-0.37%) to 2,841.91

• Dow (^DJI): -90.89 points (-0.38%) to 23,534.45

• Nasdaq (^IXIC): -13.09 points (-0.15%) to 8,933.4

• Crude (CL=F): +$1.66 (+6.02%) to $29.22 a barrel

• Gold (GC=F): +$16.10 (+0.92%) to $1,757.00 per ounce

• 10-year Treasury (^TNX): +2.1 bps to yield 0.64%

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10:19 a.m. ET: Federal Reserve nears launch of emergency lending program for local governments

The Federal Reserve published documents on Friday allowing eligible issuers in the municipal debt market to “express interest in selling notes to the special purpose vehicle (SPV) Municipal Liquidity Facility LLC,” according to the New York Fed’s website. This marked a move closer to the Fed’s launch of an emergency lending program for state and local governments, on top of the numerous stimulus measures already provided through recent monetary policy moves.

“The municipal securities market is an important part of the financial system, which helps provide states, cities, and counties (and their political subdivisions and other governmental entities) with the funding needed to provide essential public services to their citizens,” according to the statement.

“By ensuring the smooth functioning of the municipal securities market, particularly in times of strain, the Federal Reserve is providing credit that will support families, businesses, and jobs in communities, large and small, across the nation,” it added.

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10:00 a.m. ET: Consumer sentiment ticked higher in early May: U. Michigan

Consumer sentiment unexpectedly rose in early May from April, according to the University of Michigan’s Survey of Consumers.

The headline sentiment index rose to 73.7 from 71.8 in April, the preliminary survey results said. Indices measuring consumers’ assessments of current and future conditions each jumped.

“Confidence inched upward in early May as the CARES relief checks improved consumers' finances and widespread price discounting boosted their buying attitudes,” Richard Curtin, Surveys of Consumers chief economist, said in a statement.

“Despite these gains, personal financial prospects for the year ahead continued to weaken, falling to the lowest level in almost six years, with declines especially sharp among upper income households,” he added. “Improved views on buying conditions were due to discounted prices and low interest rates, although their impact was partially offset by uncertainties about job and income prospects.”

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9:50 a.m. ET: When you lose grocery stores, what’s left?

There’s no sugar-coating the ugliness of April’s stunning retail sales drop, especially when you consider the retrenchment of grocery sales. That category was the lone bright spot in March’s data, as panicked consumers stocked up by the bulk-load, seemingly in preparation for Doomsday.

Calling the numbers “downright scary,” MUFG’s Chris Rupkey said the current downturn is even worse than a depression, given the economy’s steep and sudden dive off the cliff:

However, Pantheon’s Ian Shepherdson struck a more constructive tone:

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9:30 a.m. ET: Stocks open lower after record drop in retail sales

Here were the main moves in markets, as of 9:31 a.m. ET:

• S&P 500 (^GSPC): -27.89 points (-0.98%) to 2,824.61

• Dow (^DJI): -172.92 points (-0.73%) to 23,452.42

• Nasdaq (^IXIC): -90.3 points (-1.03%) to 8,854.27

• Crude (CL=F): +$1.11 (+4.03%) to $28.67 a barrel

• Gold (GC=F): +$12.90 (+0.74%) to $1,753.80 per ounce

• 10-year Treasury (^TNX): -1.3 bps to yield 0.606%

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8:31 a.m. ET: US factory production falls by the most on record in April

U.S. factory production plunged by 13.7% in April over the prior month, the Federal Reserve said in data released Friday, marking the largest drop on record. This followed a revised 5.5% drop in March, or better than the 6.3% drop previously reported.

Capacity utilization, a measure of the amount of a factory in use, tumbled by to 64.9% in April, also the lowest on record.

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8:30 a.m. ET: Retail sales drop by a record 16.4% in April

U.S. retail sales dropped by a record 16.4% in April amid the coronavirus pandemic, the Commerce Department said in its Friday report. This was worse than the 12.0% decline expected, according to Bloomberg-compiled consensus data, and extended declines after a revised 8.3% drop in March.

Excluding auto and gas sales, retail sales dropped by 16.2% in April, following a 2.6% decline in March. Some economists look to this metric as a better gauge of underlying trends in consumer spending.

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7:29 a.m. ET: VF Corp swings to a quarterly loss, posts 35% drop in sales

VF Corp (VFC), the parent company of brands including Vans and North Face, posted a quarterly loss per share from continuing operations of $1.22, versus earnings per share of 32 cents in the comparable year-ago quarter.

Quarterly revenue of $2.1 billion fell 35% over last year for the three months to March. Each of the company’s major brands posted sales declines, led by a 19% drop in Timberland sales. Digital revenue growth to an 8% advance, versus a 21% gain over last year.

VF Corp said all of its retail stores in the Asia Pacific region, including mainland China, have now reopened. While retail store traffic has “improved recently, it remains down significantly compared with the prior year,” it said in a statement.

VF has also started a phased reopening of its retail stores in the Europe, Middle East and Africa region. And in North America, VF said it is prepared to begin a phased reopening of retail stores as well, and expects most of its locations to be open by mid-calendar year 2020.

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7:07 a.m. ET Friday: Stock futures fall ahead of retail sales data

Here were the main moves in the markets, as of 7:07 a.m. ET Friday morning:

• S&P 500 futures (ES=F): down 15 points, or 0.53%, to 2832.00

• Dow futures (YM=F): down 118 points, or 0.5%, to 23,416.00

• Nasdaq futures (NQ=F): down 30 points, or 0.33%, to 9,049.50

• Crude (CL=F): +$0.43 (+1.56%) to $27.99 a barrel

• Gold (GC=F): -$0.10 (+0.01%) to $1,740.80 per ounce

• 10-year Treasury (^TNX): -1.7 bps to yield 0.602%

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6:00 p.m. ET Thursday: Stock futures open little changed

Here were the main moves at the start of the overnight session for U.S. equity futures, as of 6:00 p.m. ET:

• S&P 500 futures (ES=F): down 3.25 points, or 0.11%, to 2,843.75

• Dow futures (YM=F): down 24 points, or 0.1%, to 23,510.00

• Nasdaq futures (NQ=F): up 1.25 points, or 0.01%, to 9,080.75

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