Dow unwinds 520-point gain as stock market turns south after omicron variant confirmed in California

How are stock-index futures trading?

• The S&P 500 scale SPX, -1.18% fell 26 points, oregon 0.6%, to 4,541, aft hitting an intraday highest astatine 4,652.94.
• The Dow Jones Industrial Average DJIA, -1.34% traded 231 points, oregon 0.7%, little to 34,253, but had established a Wednesday precocious astatine 35,004, up 520 points.
• The Nasdaq Composite Index COMP, -1.83% fell 193 points, oregon 0.7%, to scope 15,343, but had registered an intraday highest astatine 15,816.82.
• The Russell 2000 index RUT slid 1.2% to 2,172, wrong correction territory astatine 2,198.47.

On Tuesday, the Dow industrials dropped 652.22 points, oregon 1.9%, to 34,483.72. The S&P 500 fell 88.27 points, oregon 1.9%, to 4,567, portion the Nasdaq Composite declined 245.14 points, oregon 1.6%, to 15,537.69.

What’s driving the markets?

Markets were tempest tossed connected Wednesday and tilting little arsenic omicron infected an different coagulated rebound for equities.

Fauci said that “the California and San Francisco departments of nationalist wellness and the CDC person confirmed that a caller lawsuit of COVID-19 among an idiosyncratic successful California was caused by the omicron variant.”

Although the eventual emergence of a U.S. lawsuit was wide expected, comments from the nationalist wellness specializer took the upwind retired of the market’s sails, which had enjoyed a decidedly much optimistic code Wednesday.

Investors had adjacent shrugged disconnected comments from Federal Reserve Chairman Jerome Powell, who reiterated his presumption that the cardinal slope should tighten fiscal conditions to combat surging ostentation from caller variants of COVID specified arsenic omicron, testifying for a 2nd day successful beforehand of lawmakers astir the authorities of the system successful the look of the COVID-19 pandemic. Powell tempered his remarks by saying that “the taper request not beryllium a disruptive lawsuit successful markets, I don’t expect that it volition be. It hasn’t been truthful acold — we telegraphed it.”

Markets appeared to beryllium successful a much sanguine temper adjacent earlier Powell’s Wednesday testimony, arsenic investors parsed backstage payrolls successful the U.S., which roseate by 534,000 successful November, according to the ADP National Employment Report released Wednesday. Economists polled by The Wall Street Journal had forecast a summation of 506,000 private-sector jobs successful November.

The ADP results travel up of the intimately watched November payrolls information that volition beryllium released connected Friday.

Tuesday’s downturn besides was precipitated by comments from Moderna  MRNA, -11.87% CEO Stéphane Bancel, who expressed doubts astir extant vaccines against the omicron variant, which the World Health Organization connected Friday designated arsenic a variant of interest due to the fact that they fearfulness it whitethorn beryllium much transmissible and harder to immunize against owed to the mutations successful its alleged spike protein.

Read: ‘Don’t freak out’: Omicron is bound to disrupt proviso chains. The question is, however atrocious volition it be?

Analysts said investors volition stay laser focused connected updates implicit the omicron variant, with information expected implicit the adjacent 2 weeks oregon so.

“While Powell decided to discontinue the operation transitory erstwhile discussing inflation, the information is that this latest variant runs the hazard of ensuring this existent hawkish code is successful itself somewhat impermanent successful nature,” said Joshua Mahony, elder marketplace expert astatine IG, successful a enactment to clients.

“With the hazard of aboriginal lockdowns and economical closures, comments from the Fed and BOE should beryllium taken with a pinch of brackish fixed however overmuch they could alteration erstwhile we find retired the afloat grade of this variant,” said Mahony.

The U.S. is reportedly set to denote further question restrictions this week, among them a request that each incoming aerial travelers beryllium tested for COVID wrong a time of their flight. Details are being completed up of a planned code from President Joe Biden connected Thursday, wherever helium is expected to item the country’s program to power the pandemic this winter.

In different economical data, a intimately followed scale of U.S.-based manufacturers roseate to 61.1 successful November from 60.8 successful the anterior month, the Institute for Supply Management said Wednesday. That matched the forecast of economists polled by The Wall Street Journal. Any fig supra 50 signifies growth. A abstracted speechmaking from IHS Markit showed that November U.S. manufacturing PMI dropped to 58.4 vs archetypal 59.1.

Meanwhile, the Fed’s latest Beige Book compilation released Wednesday showed that portion the system was increasing astatine a mean gait successful November, businesses were raising terms astatine a accelerated clip crossed a swath of the economy.

“Prices roseate astatine a mean to robust pace, with terms hikes wide crossed sectors of the economy,” the survey found.

Which companies are successful focus?

• Groupon Inc. GRPN announced Wednesday that it has named Zappos seasoned Kedar Deshpande to beryllium the company’s adjacent main executive. Deshpande spent the past decennary astatine Zappos successful a assortment of roles, including arsenic CEO.
• Shares of GlobalFoundries GFS, -4.30%  were rising Wednesday aft the semiconductor fabricator, benefiting from the continuing planetary spot shortage, reported a 56% leap successful third-quarter revenue.

How are different assets trading?

• Gold futures GC00, +0.23% for February delivery GCG22, +0.23% roseate 0.4% to $1,784.30 an ounce.
• January West Texas Intermediate crude CLF22 fell 61 cents, oregon 0.9%, to settee astatine $65.57 a tube connected the New York Mercantile Exchange, aft touching an intraday precocious of $69.49. Prices mislaid 5.4% connected Tuesday.
• The ICE U.S. Dollar Index DXY, +0.10%, a measurement of the currency against a half-dozen different monetary units, was level astatine 96.002.
• The 10-year Treasury enactment yields TMUBMUSD10Y, 1.420% astir 1.43%, compared with 1.440% connected Tuesday astatine 3 p.m. ET. Prices for Treasurys autumn arsenic yields rise.
• The Stoxx Europe 600 SXXP, +1.71%  closed 1.7% higher and London’s FTSE 100  UKX, +1.55% roseate 1.6%.
• In Asia, the Shanghai Composite  SHCOMP, +0.36% roseate 0.3%, portion the Hang Seng Index  HSI, +0.78% gained 0.7% and Japan’s Nikkei 225 NIK, +0.41% roseate 0.4%.