The S&P 500 ended marginally lower on Thursday after a report that an experimental antiviral drug for the coronavirus flopped in its first randomized clinical trial, denting optimism that the pandemic's impact on the labor market was nearing an end.

All three main U.S. stock indexes fell back from gains of over 1% after the Financial Times reported that a Chinese trial showed that Gilead Science's remdesivir did not improve patients' condition or reduce the pathogen's presence in the bloodstream.

Gilead said results from the study were inconclusive as it was terminated early.

Last Friday, Wall Street rallied in part because of a report that COVID-19 patients in a separate study had responded positively to remdesivir.

The market's sensitivity to news related to coronavirus therapies reflects investors' desperation for any indication of when the global economy might be able to start returning to normal.

"The hope as of last week was that Gilead could take the fear of dying off the table, which would result in a much quicker, cleaner, faster recovery. If that’s less likely today than it was yesterday, it is perfectly reasonable for the market to have sold off," said David Katz, chief investment officer at Matrix Asset Advisors.

Stocks rallied earlier after data that showed weekly U.S. jobless claims fell to 4.43 million from a revised 5.24 million. However, the numbers were still staggering, taking the total in the past five weeks to a record 26 million and wiping out all the jobs created since the financial crisis.

"The disappointing drug news stings, but considering another 4 million people lost their jobs, the disconnect between how well stocks have held up in the face of historically bad economic data continues," said Ryan Detrick, senior market strategist at LPL Financial.

Meanwhile, the U.S. Congress was preparing nearly $500 billion more in aid for small businesses and hospitals, which was expected to clear the House of Representatives later in the day.

The energy index rose 3%, easily leading the 11 S&P 500 sectors as oil prices recovered in a tumultuous week that saw U.S. crude futures crash below zero for the first time in history.

U.S. stock indexes have rallied this month on a raft of global stimulus, but the benchmark S&P 500 remains more than 15% below its record high as worsening economic indicators foreshadow a deep global recession.

A survey showed U.S. business activity plumbed record lows in April, mirroring dire figures from Europe and Asia as strict stay-at-home orders crushed production, supply chains and consumer spending.

The CBOE volatility index has retreated from 12-year peaks hit last month, but remains well above levels seen in the past two years and analysts have warned of another sell-off as corporate America issues worrying forecasts for the year.

The Dow Jones Industrial Average rose 39.44 points, or 0.17%, to 23,515.26, the S&P 500 lost 1.51 points, or 0.05%, to 2,797.80 and the Nasdaq Composite dropped 0.63 points, or 0.01%, to 8,494.75.

Las Vegas Sands Corp jumped 12% after the casino operator predicted a speedy recovery in Asia on pent-up gambling demand.

In extended trade, Intel dropped over 5% after the chipmaker gave a quarterly profit forecast that missed analysts' estimates.

In Thursday's session, advancing issues outnumbered declining ones on the NYSE by a 1.64-to-1 ratio; on Nasdaq, a 1.50-to-1 ratio favored advancers.

The S&P 500 posted six new 52-week highs and one new low; the Nasdaq Composite recorded 36 new highs and 21 new lows.

Volume on U.S. exchanges was 11.7 billion shares, compared with a 12.7 billion-share average over the last 20 trading days. 

GLOBAL MARKETS

Most major stock markets edged up slightly in mixed markets on Thursday as investors weighed a rebound in oil prices and prospects for further government stimulus against stark economic data showing the toll of the coronavirus pandemic.

Investors tilted toward emerging markets from safe-haven assets like the dollar and government bonds. Gold prices jumped as much as 1.5% to top a one-week high on hopes for the impact of stimulus spending.

Oil soared after oil-producing nations said they would accelerate production to counter the oversupply that caused record plunges early this week.

U.S. crude rose 23.66% to $17.04 per barrel and Brent was at $21.73, up 6.68% on the day.

The pan-European STOXX 600 index rose 0.94% and MSCI's gauge of stocks across the globe gained 0.21%.

The dollar index, tracking the unit against six major peers, rose 0.03%, with the euro down 0.42% at $1.0777.

Benchmark 10-year U.S. Treasury notes were up and down in modest swings. The notes rose 8/32 in price to yield 0.5952%, down from 0.619% late on Wednesday.

Riskier emerging market stocks rose 0.19%. MSCI's broadest index of Asia-Pacific shares outside Japan closed 0.29% higher, while Japan's Nikkei rose 1.52%.

Spot gold added 1.0% to $1,730.50 an ounce. U.S. gold futures gained 0.73% to $1,733.30 an ounce.

Investors expected the U.S. House of Representatives to pass legislation on Thursday to authorize another $484 billion for coronavirus relief, pushing the total crisis spending near an unprecedented $3 trillion.

European Union leaders similarly added hope for the future. Some 27 leaders convened by video conference to consider adopting a bigger common budget, grants to stricken economies and joint bond sales to finance recovery from the pandemic.

Investors are anxious to see "how quickly EU policy-makers will move towards area-wide fiscal risk-sharing," said George Cole, an economist at Goldman Sachs.