Global markets assess threat of Omicron variant
New York (CNN Busines)Stocks rebounded Monday, bouncing back from the steep selloff at the end of last week, when investors feared the Omicron Covid variant could disrupt the global economic rebound.
Reports of the new Omicron variant of the coronavirus brought back memories of last summer when the fast-spreading Delta variant put a dent in the recovery and consumer confidence. This spooked investors on a traditionally quiet day in the market following Thanksgiving, leading to one of the worst days for stocks this year.
The Dow (INDU) logged its worst day since October 2020, while the S&P 500 (SPX) had its worst performance since February. The Nasdaq Composite (COMP) recorded its steepest fall since September.
But just as the market quickly bounced back from its Delta fears, history appears to be repeating itself: Investors are taking a breath and sensing a buying opportunity.
The market opened in the green, with all three indexes sharply higher. The Dow opened up 375 points, or 1.1%, while the S&P rose 1.2%. The Nasdaq was 1.5% higher.
Other asset classes that were battered Friday — notably oil and cryptocurrencies — also recovered.
US oil prices were up 6.7%, or almost $5, at $72.69 per barrel around the time of the stock market open. That doesn’t totally make up for Friday’s drop, but it takes back a chunk of it.
The global oil benchmark Brent was up 5.7% at $76.84 per barrel.
Bitcoin was up more than 5%.
“Investors are trying to make sense of the latest Omicron Covid strain, but at this point more seems to be unknown than known,” said analysts at Bespoke Investments. “Clouding things even more, we’re unlikely to have definitive answers in the immediate future.”
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