Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

S&P 500 Jumps As Cyclicals, Tech Bounce on Easing Omicron Worries

Stock MarketsDec 07, 2021 06:20
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.

By Yasin Ebrahim

Investing.com – The S&P 500 climbed Monday, led by a surge in cyclical stocks and turnaround in tech as positive updates on the Omicron variant of Covid-19 renewed investor optimism about the economic recovery.

The S&P 500 rose 1.5%, the Dow Jones Industrial Average gained 2.2%, or 744 points, the Nasdaq climbed 1.1%. All three major averages as well as the Russell 2000 Futures hit record intraday highs.  

The latest updates on the Omicron variant suggest the new coronavirus strain is less deadly than feared, easing investor fears about a potential economic fallout.

"[A]lthough it’s too early to make any definitive statements about it, thus far it does not look like there’s a great degree of severity to it," said Dr. Anthony Fauci, President Joe Biden's chief medical adviser, on CNN on Sunday.   

Renewed optimism on the recovery pushed cyclical stocks including financials and energy higher.

Financials, mostly banks, were also boosted by a rebound in Treasury yields following a rout last week, with the United States 10-Year yield rising above 1.4%.

First Republic Bank (NYSE:FRC), State Street (NYSE:STT), and Wells Fargo (NYSE:WFC) were sharply up more than 3% as rising Treasury yields boosts the net interest margin of banks – the difference between the interest income generated by banks and the amount of interest paid out to depositors.

As well as rising Treasury yields, Wells Fargo was boosted by an upgrade from Morgan Stanley.

Morgan Stanley upgraded Wells Fargo to overweight from equal weight amid expectations for a faster pace of Federal Reserve rate hikes.

Energy, meanwhile, was pushed higher by rising oil prices after Saudi Arabia hiked its selling prices for oil exports to U.S. and Asian customers.

"Today’s upswing was sparked by Saudi Arabia’s raising of its official selling prices at the weekend," Commerzbank said in a note. "The world’s largest exporter will be charging a higher price premium for oil deliveries to Asia in January than in the previous month."

Reopening sectors of the market including airlines, cruise lines, and hospitality stocks were in the ascendency. 

American Airlines (NASDAQ:AAL), Carnival (NYSE:CCL), and Wynn Resorts (NASDAQ:WYNN) were sharply higher. 

Tech jumped, adding to the broader market melt-up as investors bought the dip in big tech.

Semiconductor stocks, however, weighed on tech as Nvidia (NASDAQ:NVDA) slipped about 3% adding to recent losses.

Micron Technology Inc (NASDAQ:MU) was flat even as Cowen hiked its price target on the stock to $99 from $8, as growing memory demand and tight supplies are expected to bolster the chipmaker's performance.

In electrical vehicle stocks Tesla (NASDAQ:TSLA) and Lucid (NASDAQ:LCID) were among the biggest decliners following regulatory troubles.

Lucid Group fell 4% after receiving a subpoena from the Securities and Exchange Commission related to its special purpose acquisition company merger deal with Churchill Capital Corp.

Tesla was down 1% after the U.S. Securities and Exchange Commission launched a probe into a whistleblower claims alleging the company had failed to notify its shareholders of solar panel defects, Reuters reported, citing a letter from the agency.

S&P 500 Jumps As Cyclicals, Tech Bounce on Easing Omicron Worries
 

Related Articles

Australian Shares Finish 0.3% Higher
Australian Shares Finish 0.3% Higher By Investing.com - Jan 17, 2022

By Oliver Gray  Investing.com - The S&P/ASX 200 finished Monday’s session higher, adding 23.40 points or 0.32% to 7,417.30 as market participants digested Chinese GDP figures,...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email