Market Snapshot: Dow attempts to claw back from omicron-sparked losses, but trades off opening highs


U.S. stock benchmarks were on the rise early Monday, following a steep selloff Friday sparked by fears of the global economic impact of a worrisome new variant of the coronavirus that causes COVID-19.

How are stock-index futures trading?
  • The Dow Jones Industrial Average rose 120 points, or 0.4%, to 35,031, but was off an opening peak at 35,287.91.
  • The S&P 500 index gained 44 points, or 1%, to 4,639.
  • The Nasdaq Composite Index advanced 210 points, or 1.4%, to 15,704.

In a holiday-shortened session on Friday, the Dow slumped 905.04 points, or 2.5%, to 34,899.34, with the index logging its worst daily drop since Oct. 28, 2020, according to FactSet data. The S&P 500 fell 106.84 points, or 2.3%, to 4,594.62, and the Nasdaq Composite sank 353.57 points, or 2.2%, to 15,491.66.

What’s driving the markets?

Stocks were staging a partial comeback on Monday following the worst day in more than a year for the Dow and S&P 500 on Black Friday, amid growing concerns over the new omicron variant of the coronavirus. The World Health Organization’s technical advisory group on Friday declared it a “variant of concern,” and a number of countries imposed flight bans from countries in southern Africa, where the variant was first discovered. Omicron has been detected in around a dozen countries, according to media reports.

Read: ‘Markets don’t bottom on a Friday’: COVID stock rout puts these S&P 500 levels in focus when trading resumes

Little is known about omicron, but investors Friday braced for bad news. Still, some were focusing on preliminary indications of “mild” symptoms among those who had tested positive.

Dr. Angelique Coetzee, the South African doctor who was first to spot the new variant, told the BBC over the weekend that patients she had seen had “extremely mild symptoms.” But she added that it wasn’t clear yet how the disease would affect more vulnerable people, a view that was echoed elsewhere.

Read: U.S. health officials urge caution, but not panic, over omicron variant

“The pandemic and COVID variants remain one of the biggest risks to markets, and are likely to continue to inject volatility over the next year(s),” Keith Lerner, co-chief investment officer and chief market strategist at Truist Advisory Services, wrote in a Friday note. “It’s hard to say at this point how lasting or impactful this latest variant will be for markets.”

Investors will get important economic updates this week, which ends with November nonfarm payroll on Friday. Pending-home sales are due for Monday.

Retailers will remain in focus for Cyber Monday, another big post-Thanksgiving shopping day. Adobe Analytics reportedly said online shoppers spent $8.9 billion this year, at the low end of its expectations and slightly short of the $9 billion that was spent in 2020.

Crude oil futures were also rebounding from a plunge Friday, with benchmark U.S. crude CLF22, +5.63% up 5% to $71.61 a barrel, and Brent crude BRNF22, +4.39%, the international benchmark, jumping more than 4% higher to $76.08 a barrel.

Investors are awaiting this week’s OPEC gatherings, with a couple of technical meetings reportedly delayed so that members can assess the variant and price action. WTI slumped 13.1%, to close at $68.15 a barrel on the New York Mercantile Exchange on Friday, the biggest one-day drop for a front-month contract since April 20, 2020, according to Dow Jones Market Data. Brent tumbled 11% and both contracts saw their lowest close since Sept. 9.

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