Markets reverse on more Omicron news

Allan Tong Posted On December 1, 2021

On Wednesday morning, stocks bounced 1.5% off Tuesday’s sharp sell-off, then sank in the afternoon upon news of the first Omicron case reaching the U.S. The Dow swung 1,000 points for the session before losing 1.34%. Similarly, the S&P closed -1.18% and the Nasdaq -1.83%.

The losses weren’t as sharp as Black Friday or Tuesday, but many names touched 52-week lows, such as Mastercard which sank 2.74%. AMD closed -5.88%, tech darling Tesla -4.35%, and even lockdown winner Walmart finished -2.48%. Unsurprisingly, travel and leisure stocks got hit hard with American Airlines and Royal Caribbean both sinking around 8%. Moderna was hammered for 11.87% while Penn National lost 6.58%. Gainers were few and far between, and included Applied Materials up 3%, Lennar at 3.35% and Lam Research by 2%.

The TSX’s suffered fewer losses as the Canadian index shed 0.95%. Financials and telcos offered modest gains. The big banks report this week and Royal disappointed by missing earnings though raised its dividend and announced a share buyback. RY shares retreated 0.44%. Similarly, National Bank missed earnings and raised dividends, but sank 3.46%. In contrast, Scotiabank rallied 3.42% and TD rose 2% ahead of earnings. Other winners included Western Forest Products which jumped 8.28%, Martinrea climbed 4.16% and Interfor rose 3.48%. However, Bombardier went into a 10.4% tailspin, Air Canada dove 3.17% while Baytex sank 3.26%. They weren’t helped by crude oil losing 1-1.5% to $65 a barrel for WTI and $47 for WCS. Gold was flat and Bitcoin retraced 1.3% to around $57,000. Clarity over Omicron should come in the next two weeks as scientists investigate the latest variant.