Tue, 09 Aug 2022

American stocks buckle as Omicron arrives in U.S.

Lola Evans
02 Dec 2021, 08:02 GMT+10

NEW YORK, New York - A single case of Omicron, that being the first in the U.S., sent stocks into freefall on Wednesday.

Despite being well ahead the CDC, in reporting the first case, not exactly unexpected that cases would emerge in the United States, punctured the main indices, reversing the strong gains being recorded.

"It feels as though the market was wondering when, not if there was going to be this new variant on our shores," Art Hogan, National Securities chief market strategist told CNBC Wednesday.

"I think we're at a place now where we understand there's a diminishing impact with new waves and new variants with this virus," he said.

Steve Massocca of Wedbush Securities told CNBC: "I think a lot of it is tax-loss selling. I think a lot of the poor names are doing worse because people are taking tax losses because they have so many gains elsewhere," he said.

The shock reversal left the Dow Jones down 461.68 points or 1.34 percent at 34,022.04 at the finish Wednesday.

The Nasdaq Composite gave up all its gains on the day plus 283.64 points or 1.83 percent, to close Wednesday at 15,254.25.

The Standard and Poor's 500 shed 53.91 points or 1.18 percent to 4,513.04.

Safe-haven currencies, the U.S. dollar, and the Japanese yen benefited from the volatility. The euro dropped to 1.1319 by the New York close Wednesday. The British pound fell to 1.3271. The Swiss franc firmed to 0.9205.

The Canadian dollar sank to 1.2816. The Australian dollar dropped to 0.71094. The New Zealand dollar dived to 0.6809. The Japanese yen meantime advanced more than a full cent to 112.77.

The rest of the world, unconcerned about a single case on American shores, piled on significant gains. The German Dax soared 2.47 percent. The FTSE 100 in London gained 1.55 percent. The Paris-based CAC 40 added 2.39 percent.

On Asian markets, the Nikkei 225 in Japan edged up 0.41 percent. The Hang Seng in Hong Kong gained 0.78 percent. China's Shanghai Composite rose 0.36 percent. The Australian All Ordinaries went against the trend, slipping 0.39 percent.

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