By Geoffrey Smith
Investing.com -- U.S. stock markets rallied in morning trading after a slow start, as the absence of major news and promising reports regarding Omicron may have set the stage for a "Santa rally".
At 11:35 AM ET (1635 GMT), the Dow Jones Industrial Average was up .5%, or 188 points to 35,522 points. The S&P 500 climbed .77% while the Nasdaq Composite resumed leadership, up .88%.
Markets had rallied on Tuesday after President Joe Biden chose not to announce any new restrictions on life due to the fresh wave of Covid-19 cases, instead choosing to roll out more testing capacity across the nation. The move reinforced impressions that the disease is progressing from pandemic to endemic, and will no longer lead to major economic disruption.
Earlier, the last revision of third-quarter GDP figures failed to make waves, despite a small upward revision in the annualized rate of growth to 2.3%. Core personal consumer expenditures inflation was also revised up slightly for the quarter, to 4.6% from 4.5%, a reminder of the price pressures that have displaced the coronavirus as the market's number one risk factor.
Oxford Economics' Oren Klachkin noted that corporate profits were lower than previously estimated but still hit a record in the quarter, while profit margins reached 12.6% of GDP, the highest since 2012. However, he warned that higher labor costs and weaker productivity gains will weigh on corporate profit margins next year.
Among early movers, Tesla (NASDAQ:TSLA) stock caught the eye with a 7.5% gain after comments from CEO Elon Musk to the website Babylon Bee indicated that he has stopped selling stock, removing what has been a significant headwind in recent weeks. Business software provider Paychex (NASDAQ:PAYX) saw its stock rise nearly 7% to a new record high after posting strong earnings through November, which were some 12% ahead of expectations.
CarMax (NYSE:KMX) stock fell 5% despite reporting another strong quarter for sales and earnings. The rise in earnings, around half of which was due to a one-off factor, wasn't enough to offset conviction that the peak of the used-car boom has passed, and that performance will revert to the mean next year.
Amazon (NASDAQ:AMZN) stock shrugged off reports of another outage at Amazon Web Services, the company's biggest profit generator, trading up nearly 1%. One of the companies said to be hit by the outage was Coinbase (NASDAQ:COIN), but the crypto exchange's stock didn't reflect any pressure on it.
Alibaba (NYSE:BABA) shares were down nearly 4% on news of a lost partnership with the Chinese government.
(This article was published at 9:48 am ET, and updated at 11:35am ET).