US equities: Wall Street confused as Omicron worries persist

U.S. stock indices struggled on Wednesday, cooling off after a rally the day before, as concerns persisted around the Omicron variant of the coronavirus and its impact on the global economic recovery.

Major Wall Street indices ended with sizable gains on Tuesday, but few catalysts for market movements and low volumes in the last two weeks of trading this year are likely to push volatility up. For 2021, the S&P 500 Index is up about 24%.

Investors have requested updates on the Omicron variant after Germany, Scotland, Ireland, Portugal, the Netherlands and South Korea reimposed lockdowns or other restrictions.

“We really saw some big straight selling days followed by a rebound day. This brings us back to neutral territory and takes into account some of the new headwinds, including the rapid pace of transmission of the Omicron variant and the suspension of the Build Back Better bill, ”said Art Hogan, chief market strategist. at National Securities in New York.

US Democratic Senator Joe Manchin earlier this week rejected President Joe Biden’s social and climate policy plan, dealing a heavy blow to financial markets.

Six of the 11 major sector indices in the S&P 500 were higher early in the session.

Tesla Inc jumped 4.0%, leading gains among mega-caps. According to an interview published Tuesday, Tesla CEO Elon Musk said he had sold “enough shares” to complete his plan to sell 10% of his shares in the company.

At 9:38 a.m. ET, the Dow Jones Industrial Average was up 3.55 points, or 0.01%, to 35,496.25, the S&P 500 was up 2.66 points, or 0.06%, at 4,651.89 and the Nasdaq Composite was down 17.04 points, or 0.11%. . at 15,324.04.

Pfizer rose 0.9% after announcing it would deliver 2.5 million more doses of its COVID-19 pill Paxlovid to the UK.

Additionally, the U.S. Food and Drug Administration is expected to approve Pfizer and Merck’s COVID-19 treatment pills as early as Wednesday, according to a Bloomberg News report. Merck climbed 0.3%.

Caterpillar Inc gained 1.9% after broker Bernstein said it expects the industrial equipment maker to be the biggest beneficiary of an easing of monetary policy in China.

Markets were also awaiting President Joe Biden’s meeting later today with U.S. officials and private sector companies, including FedEx, to discuss ongoing efforts to deal with supply chain disruptions.

A final read of gross domestic product data showed economic growth slowed sharply in the third quarter amid rising COVID-19 infections, but activity has since picked up, putting the economy on track to record its best performance this year since 1984.

The advancing issues outnumbered declines by a 1.10 to 1 ratio on the NYSE. The declining issues outnumbered the advancements for a 1.60 to 1 ratio on the Nasdaq.

The S&P Index recorded five new 52-week highs and no new lows, while the Nasdaq recorded 10 new highs and 29 new lows.

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