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Wall Street Rebounds from Omicron Shock at Open; Dow up 160 Pts

Stock MarketsNov 29, 2021 09:45AM ET
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© Reuters

By Geoffrey Smith 

Investing.com -- U.S. stock markets opened higher on Monday, recovering from the abrupt sell-off on Friday that happened in reaction to news of a new variant of Covid-19. 

The Omicron variant, as it is now called, appears to be more highly transmissible than the Delta variant that has caused most Covid-19 deaths this year, and World Health Organization officials have officially termed it a "variant of concern." However, there is no evidence yet to suggest that it is more deadly than Delta, and stocks have been supported on Monday by a number of analysts calling Friday's sell-off an over-reaction.

Scientists in South Africa, where the variant was first detected, said that existing vaccines appear likely to prevent severe infection even by the new variant, something that - if confirmed - would greatly reduce the risk of new measures that would hurt economic activity. Moderna (NASDAQ:MRNA) stock rose 7.5%, after being hit by fears on Friday that its Covid-19 vaccine could be outflanked by Omicron.

By 9:40 AM ET (1440 GMT), the Dow Jones Industrial Average was up 160 points, or 0.5%, at 35,075 points. The S&P 500 was up 1.0% and the Nasdaq Composite was up 1.4%. All three indices had suffered their worst day in months on Friday, in a move that was exacerbated by low liquidity due to the holiday. 

Twitter (NYSE:TWTR) stock stood out in early trade, rising as much as 12% on reports that founder Jack Dorsey may step down as chief executive. It quickly gave up most of its gains, however, to trade up 4.4%. Dorsey has been heavily criticized by some shareholders for allotting plenty of time to other projects, notably payments company Square (NYSE:SQ), where he is also CEO. The company has also struggled to grow advertising revenue as quickly as some other social media rivals, and while its repeated failures in reining abusive behavior by its users has generate significant concern among lawmakers and regulators.

Twitter has been targeted by activist investor Elliott Management, which now has a seat on its board.

Travel stocks epitomized the trend, with Carnival (NYSE:CUK) stock rising 2.8% after plummeting to a 12-month low on Friday, while Airbnb Inc (NASDAQ:ABNB) stock rose 3.0% after hitting a one-month low in response to fears that the new variant would swiftly lead to fresh lockdowns.

Hertz Global (NASDAQ:HTZ) stock rose 3.7% after announcing a $2 billion stock buyback, the latest in a series of moves designed to reduce its cost of capital as it puts its bankruptcy episode behind it. The company had already announced its intention ot refinance expensive preferred stock with new debt last week. Hertz repeated its intention not to exceed a net leverage level of 1.5 times earnings before interest, taxes, depreciation and amortization.

Elsewhere, ADRs of Chinese electric vehicle maker Li Auto (NASDAQ:LI) rose 9.1% after an upbeat quarterly update. 

Wall Street Rebounds from Omicron Shock at Open; Dow up 160 Pts
 

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Comments (8)
Mox Mox
Mox Mox Nov 29, 2021 12:06PM ET
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hahaha Twitter jumps because it's pos CEO resigns. great
Tom Scurlo
Tom Scurlo Nov 29, 2021 10:48AM ET
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This market is just like thr prices at the gas pump. When the dog farts… the price jumps up 25 cents a gallon…. Then it goes back down over the next 4 weeks. Same with the market… there is a huge sell off…. But to gain it all back…. It takes 4 weeks to get it back.
Тони Chuk
Тони Chuk Nov 29, 2021 10:48AM ET
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you mean to print it back :d don't worry! the ship is sinking normally! there will be enough water for everyone :d
Stan Smith
Stan Smith Nov 29, 2021 10:36AM ET
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Tapering???...Bah Humbug!
DrFunkenstein hayson
DrFunkenstein hayson Nov 29, 2021 10:28AM ET
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the never ending virus. the perfect excuse for the fed, bankers and g o v t to hide their disastrous deceitful policies
Stan Smith
Stan Smith Nov 29, 2021 10:21AM ET
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Miracle Monday...who could have seen this coming? FYI Inflation and Omicron are still around and getting worse. Thanks FED. We're still gonna taper right?, right?
Aleksandr Radchenko
Aleksandr Radchenko Nov 29, 2021 10:21AM ET
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if everything goes well then why change anything?
William Bailey
William Bailey Nov 29, 2021 10:19AM ET
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300 billion pumped in yesterday at 2:45 gad nothingbto do with it…
Stan Smith
Stan Smith Nov 29, 2021 10:19AM ET
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Real pumps for real healthy markets...
Mitchel Pioneer
Mitchel Pioneer Nov 29, 2021 10:11AM ET
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Ah yes, the magical 10AM breaker fires with the predictability of the sunrise.  And the laughable NASDAQ once again gets "gains" shoved down its throat.  The biggest investment joke in the world is going to give America quite the holiday gift, another financial knife in the back.
Sandra Garcia
Sandra Garcia Nov 29, 2021 9:59AM ET
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Crypto is much better
 
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