Stocks fell on Monday in the beginning of a holiday-shortened week of buying and selling, with buyers contemplating renewed virus-related restrictions abroad and prospects {that a} vital social coverage invoice could also be scuttled.
The S&P 500, Dow Nasdaq every dropped by almost 2% throughout intraday buying and selling. Treasury yields fell as buyers piled into protected haven belongings, and the benchmark 10-year yield held beneath 1.4%. The CBOE Volatility Index, or VIX, spiked greater than 20% to hover above 25.
U.S. crude oil costs sank 3% to commerce beneath $69 per barrel as restrictions mounted in Europe, stoking jitters round power demand. Countries from Germany to Ireland imposed curfews or journey restrictions in current days given the quickly spreading new variant. And the Netherlands over the weekend introduced a nationwide lockdown of non-essential shops, bars and eating places till Jan. 14. As of this weekend, the Omicron variant had been reported in about 89 nations, with circumstances doubling each 1.5 to three days.
Renewed fears over the financial affect of the Omicron variant compounded with final week’s issues for buyers across the prospects of tighter financial coverage, with the Federal Reserve accelerating its price of asset-purchase tapering and signaling three rate of interest hikes might be coming subsequent yr. Last week, every of the three main indexes posted steep weekly losses. The Nasdaq Composite fell 3% and the S&P 500 and Dow every dropped by almost 2% for the week.
Still, different updates across the impact of present COVID-19 vaccines on the variant had been extra upbeat. Moderna (MRNA) stated Monday {that a} booster, or a 3rd dose, of its shot elevated Omicron neutralizing antibody ranges. This echoed outcomes from Pfizer (PFE) and BioNTech (BNTX) from earlier this month in regards to the effectiveness of their vaccine’s third dose on neutralizing Omicron. Shares of Moderna gained greater than 7% forward of the opening bell.
Investors additionally digested the sudden information that Senator Joe Manchin (D., W. Va.) wouldn’t assist President Joe Biden’s $1.75 billion Build Back Better social coverage invoice. Manchin, talking on Fox News Sunday, stated he had mentioned with Democratic House and Senate leaders and Biden, however was unable to come back to an settlement on the invoice given issues about inflation, the nationwide debt and ongoing pandemic.
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White House Press Secretary Jen Psaki launched a press release calling Manchin’s feedback “a sudden and inexplicable reversal in his place,” and stated the administration would work to maneuver ahead with the laws subsequent yr.
Still, Goldman Sachs this weekend slashed its quarter GDP forecasts for 2022 following Manchin’s withdrawal of assist for the invoice. The economists, led by Jan Hatzius, stated they anticipated the “fiscal impulse will likely be considerably extra adverse” than beforehand anticipated subsequent yr, in absence of the spending on social and climate-related insurance policies included within the invoice. The agency lowered its U.S. GDP forecast to 2% from 3% for the primary quarter of 2022, to three% from 3.5% for the second quarter, and to 2.75% from 3% for the third quarter.
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11:41 a.m. ET: Stocks lengthen losses, Dow drops almost 700 factors
The three main indexes prolonged losses heading into the afternoon session, constructing on in a single day declines as virus-related issues flared anew.
The Dow dropped greater than 650 factors, or about 1.9%, shortly earlier than midday in New York. The Nasdaq declined by simply over 1%, and the S&P 500 was additionally down about 1.9%.
All 11 main sectors had been within the crimson within the S&P 500, with the cyclical power, financials and supplies sectors main the way in which decrease. Consumer staples, utilities and healthcare outperformed, although these sectors had been additionally decrease in the course of the session.
In the Dow Jones Industrial Average, Goldman Sachs, The Travelers Cos. and Caterpillar underperformed.
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10:28 a.m. ET: Oracle plans to purchase Cerner Corp. for $28.3 billion in largest-ever acquisition for software program big
Oracle (ORCL) introduced on Monday it deliberate to purchase Cerner Corp., an digital medical information firm, for $28.3 billion. This could be the largest-ever deal for Oracle.
The deal is anticipated to shut subsequent yr, and would give Oracle entry to Cerner’s trove of software program used to file healthcare information electronically. Cerner shareholders will obtain $95 in money for every share held, which marks a premium of almost 6% in comparison with Friday’s closing costs for the inventory.
Oracle shares had been down by 2.6% following the announcement, underperforming the broader market in the course of the session. Oracle shares had been up 49% for the year-to-date by Friday’s shut.
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9:30 a.m. ET: Stocks open decrease
Here’s the place markets opened Monday morning:
S&P 500 (^GSPC): -61.45 factors (-1.33%) to 4,559.19
Dow (^DJI): -454.32 factors (-1.28%) to 34,911.12
Nasdaq (^IXIC): -237.69 factors (-1.53%) to 14,942.55
Crude (CL=F): -$3.10 (-4.37%) to $67.76 a barrel
Gold (GC=F): -$7.10 (-0.39%) to $1,797.80 per ounce
10-year Treasury (^TNX): -1.7 bps to yield 1.385%
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7:45 a.m. ET Monday: Stock futures level to a sharply decrease open
Here’s the place markets had been buying and selling as of Friday morning forward of the opening bell:
S&P 500 futures (ES=F): -52.25 factors (-1.13%), to 4,557.75
Dow futures (YM=F): -366 factors (-1.04%), to 34,886.00
Nasdaq futures (NQ=F): -208.5 factors (-1.32%) to fifteen,579.50
Crude (CL=F): -$2.20 (-3.10%) to $68.66 a barrel
Gold (GC=F): -$6.50 (-0.36%) to $1,798.40 per ounce
10-year Treasury (^TNX): -1.7 bps to yield 1.385%
Photo by: NDZ/STAR MAX/IPx 2021 12/16/21 Atmosphere on the New York Stock Exchange (NYSE) on December 16, 2021 in New York.
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Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter
