US Stocks Rally as Omicron Fears Recede

Early data showing that the Omicron variant is not as serious as previous strains led to a rush of positive trading on Wall Street this Thursday.

The S&P 500 was close to its record high from late November. Buoyed by positive gains from stocks like MGM Resorts that are sensitive to pandemic news, the bourse gained 0.6%.

After more vaccine manufacturers said their jabs provided protection against Omicron, consistent evidence is emerging from South Africa and the UK that Omicron causes far fewer hospitalizations than previous variants.

Investors are now heading into the new year in much better spirits as Omicron’s effect on global economies is expected to be less severe than once feared. 

Continuing the positive trend, the Dow Jones Industrial Average was up 0.65% at the end of Thursday’s trading. The Nasdaq Composite gained 0.43% over the same period.

What does this mean for me?

This year, news of the pandemic became a bellwether for the global economy. One one hand, unwelcome news, such as increased restrictions, had the effect of immediately dampening market sentiment. On the other hand, as we have seen from this short piece, positive news was received well by the market as investors could look forward to uninterrupted trading.

As a stock trader and market watcher, it pays to understand how important global news shapes market sentiment. The more you can decipher the effects of world events and apply them proactively to your portfolio, the better your trading skills will become.