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S&P 500 Climbs Back as Bulls Snap Up Oversold Stocks

Stock MarketsDec 02, 2021 04:03PM ET
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© Reuters.

By Yasin Ebrahim

Investing.com – The S&P 500 rebounded Thursday, as traders loaded up on oversold stocks following a broader market rout a day earlier after the U.S. confirmed its first case of the Omicron variant of Covid-19.

The S&P 500 rose 1.4%, the Dow Jones Industrial Average gained 1.82%, or 619 points, the Nasdaq added 0.83%. and Russell 2000 was up 2.5% 

“Yesterday's bearish reversal pushes U.S. equities into oversold territory once again and sets us up for another strong rally effort,” Janney Montgomery Scott said in a note. But there is “likely (still) more to go in this current market correction.”

Financials outperformed the broader market, led by banking stocks as Treasury yields rose after some on Wall Street suggested that a potentially more contagious Omicron variant could speed up the end of the pandemic and ultimately cause the yield curve to steepen

“If the market were to anticipate that scenario — omicron could be a catalyst for steepening (not flattening) the yield curve, rotation from growth to value, selloff in COVID and lockdown beneficiaries and rally in reopening themes,” chief global strategist Marko Kolanovic and quant strategist Bram Kaplan wrote in a note to clients.

Regional banks including Fifth Third (NASDAQ:FITB), People’s United Financial (NASDAQ:PBCT), and SVB Financial (NASDAQ:SIVB) were among the biggest gainers in financial, rising more than 4%.

Industrial were also helped by a rebound in airline stocks, led by Boeing Co (NYSE:BA) after China cleared the aircraft maker’s 737 Max to return to the skies on Thursday.  The 737 Max returned to service in China after being grounded for more than two years following two fatal crashes.

Delta Air Lines (NYSE:DAL), Alaska Air (NYSE:ALK), and United Airlines Holdings Inc (NASDAQ:UAL) were also sharply higher.

Energy stocks were boosted by rising oil prices after OPEC and its allies decided to stick with their current plan of lifting oil output by 400,000 barrels a day in January.

In tech, Apple (NASDAQ:AAPL) pared some losses after the tech giant warned some its chip suppliers of weaker demand for its latest iPhones, Bloomberg reported.

Nvidia (NASDAQ:NVDA) ended higher despite losing some steam after The Federal Trade Commission sued to block the chipmaker's $40 billion acquisition of Arm from SoftBank, citing antitrust concerns.

On the economic front, better-than-expected weekly jobless claims data stoked optimism on the labor market recovery ahead of Friday’s monthly jobs.

The Labor Department reported that 222,000 people filed for unemployment insurance, confounding economists’ expectations for an 18,000 rise.

A blowout jobs report, however, could give force the Federal Reserve to hike rates and spook investors.   

"If the job numbers are way better than expected, pointing to a super strong economy that could spook investors because it would point to Federal Reserve Chairman Jerome Powell having to perhaps be a lot more aggressive than than he thought," Eric Diton, president and managing director at The Wealth Alliance told Investing.com in an interview earlier this week. "But something in line or even on the strong side would be fine."

Nonfarm payrolls are expected to have increased by 560,000 in November, with unemployment rate expected to drop to 4.4%.

S&P 500 Climbs Back as Bulls Snap Up Oversold Stocks
 

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Comments (20)
perplexed76 .
perplexed76 . Dec 03, 2021 1:49AM ET
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bull gamblers trying to scare Omi by buying papers lol
Mitchel Pioneer
Mitchel Pioneer Dec 02, 2021 9:07PM ET
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The US Ponzi Scheme is the laughingstock of the financial world.
Sean Livingstone
Sean Livingstone Dec 02, 2021 8:56PM ET
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One day omicorn good, one day omicorn bad... Today is good, tomorrow we already know, it's bad. These few days have been profitable for me. Next week, omicorn is no news, we rally.
Dave Jones
Dave Jones Dec 02, 2021 8:47PM ET
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oversold...lolz
Jack Zydron
Jack Zydron Dec 02, 2021 8:42PM ET
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Mild cases, sore throats and headaches. Daily deaths at the lowest ever. have we lost our sanity or media and governments. This will explode in next days. all in green!!!
Jin News
Jin News Dec 02, 2021 7:02PM ET
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The bulls are too strong
Isidro Fernandez
Isidro Fernandez Dec 02, 2021 6:34PM ET
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Omicron whaaaaat? We're going to be dealing with covid for the rest of our natural lives.Markets will perform well in the long run.
Isidro Fernandez
Isidro Fernandez Dec 02, 2021 6:31PM ET
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We watched this movie, look at the times interest rates got increased and see what happened with the stock market.
peter neal
peter neal Dec 02, 2021 6:30PM ET
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This isn't going to end well if they actually try to raise rates. Music has stopped.
Ronald Warren
Ronald Warren Dec 02, 2021 6:26PM ET
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If you're going to survive into 2022, you're going to have to be able to smell a bull trap.
Rob Chan
Rob Chan Dec 02, 2021 5:28PM ET
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What happened to Omiron. I thought the sky was about the fall as one person was found infected, and humanity was about to end....lmao
New Jazenevd
New Jazenevd Dec 02, 2021 5:14PM ET
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The market goes higher by reasons more serious than omicron, disregarding medical issues. The market goes higher because of the inflation. Asset inflation is the leading part of the overall inflation. That’s it. No conspiracies, just printing money non-stop.
Max German
MaxiGE Dec 02, 2021 5:04PM ET
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"oversold" a average stock up 30% lol tech not even dropping lol
Mitchel Pioneer
Mitchel Pioneer Dec 02, 2021 4:37PM ET
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Another criminal day in the fraudulent US Ponzi Scheme.
I am confused
I am confused Dec 02, 2021 4:37PM ET
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another hater to the greatest economy on earth
Antonio Velardo
Antonio Velardo Dec 02, 2021 4:37PM ET
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I am confused he is a short looser and whiner.
Mitchel Pioneer
Mitchel Pioneer Dec 02, 2021 4:37PM ET
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Uh, you mean this FED manufactured eCONomy?
Mario tragik
Mario tragik Dec 02, 2021 4:28PM ET
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So omicron is no longer a threat? lmao what a joke. Well, newsflash omicron was never really a worry to the markets, just another excuse to move the needle and take advantage of gullible people. im not surprise one bit this prints anothet ATH because ... santa rally? lol what a joke the markets have become.
Stan Smith
Stan Smith Dec 02, 2021 4:28PM ET
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Hyperinflation and tapering are also forgotten threats as well it seems. FED stock pumps don't care about the news and the real world
Stan Smith
Stan Smith Dec 02, 2021 4:26PM ET
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Bag holders all in
Kapil Baldawa
Kapil Baldawa Dec 02, 2021 4:25PM ET
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Oversold stocks? really? Just 3-4% down from highs.. Money printing, if stops it'll be back to 3300-3500.. can't justify 20-23x fwd multiple forever
Stan Smith
Stan Smith Dec 02, 2021 4:25PM ET
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Oversold??? are you absolutely kidding me!! Quoting another member "markets "rally" for days on end yet isn't "overbought," but it drops a few hundred points and it's "oversold."
Rehan Ail
Rehan Ail Dec 02, 2021 4:22PM ET
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Jon Bal
Jon Bal Dec 02, 2021 4:16PM ET
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but the s&p 5 were down?
 
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