(Bloomberg) -- Gilead Sciences Inc.'s pair of promising announcements for its Covid-19 drug candidate, remdesivir, sparked a further rally in biotechnology stocks that have already been on a tear over the past month and a half.
The iShares Nasdaq Biotechnology exchange traded fund, ticker IBB, jumped as much as 4.2% in early trading Wednesday, on pace to open near the highest level since 2015. The pop came in the wake of two announcements from Gilead that studies of remdesivir benefited patients stricken by the novel coronavirus.
The early morning rally has the IBB on track to extend what has been a 32% snap-back from a March 16 low. That advance compares to a 20% gain for the S&P 500 over that same stretch as investors continue to put money to work. An equal-weighted ETF tracked by specialists, the SPDR S&P Biotech ETF (XBI), rose 3% at 9:00 a.m. Eastern time.
Biotechnology -- and the healthcare sector more broadly -- has been red-hot this year as investors look for ways to play the fight against the coronavirus pandemic.
Read more: Overheated Health-Care Stock Rally Starts to Draw Early Warnings
Gilead shares surged 9% as trading resumed after the announcements. Small-cap BioCryst Pharmaceuticals Inc. jumped as much as 34% after the Gilead announcement. The company is studying galidesivir, a drug that works in a similar way to remdesivir, in Covid-19 patients.
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