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U.S. Stocks Move Sharply Lower Amid Omicron Concerns

wallstreet oct17 20dec21 lt

Following the steep drop seen last week, stocks have shown another significant move to the downside in morning trading on Monday. The major averages have all slid firmly into negative territory, with the Nasdaq falling to its lowest intraday level in two months.

Currently, the major averages continue to post substantial losses. The Dow is down 553.62 points or 1.6 percent at 34,811.82, the Nasdaq is down 206.93 points or 1.4 percent at 14,962.76 and the S&P 500 is down 64.66 points or 1.4 percent at 4,555.98.

Concerns about the rapid spread of the Omicron variant of the coronavirus have contributed to the continued weakness on Wall Street.

With the World Health Organization saying the number of cases is doubling in 1.5 to 3 days in areas with community transmission, traders seem worried the new strain could derail the global economic recovery.

The spread of the Omicron variant could also lead to further global supply chain issues, which have contributed to elevated inflation.

Energy stocks have shown a substantial move to the downside, moving sharply lower along with the price of crude oil. Crude for January delivery is currently plunging $3.88 to $66.98 a barrel.

Reflecting the weakness in the energy sector, the Philadelphia Oil Service Index is down by 2.9 percent and the NYSE Arca Oil Index is down by 2.3 percent.

Significant weakness has also emerged among steel stocks, as reflected by the 2.7 percent slump by the NYSE Arca Steel Index.

Financial, tobacco, and housing stocks are also seeing considerable weakness on the day, moving lower along with most of the other major sectors.

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Monday. Japan's Nikkei 225 Index tumbled by 2.1 percent, while China's Shanghai Composite Index slumped by 1.1 percent.

The major European markets have also shown notable moves to the downside on the day. While the German DAX Index has plummeted by 2 percent, the U.K.'s FTSE 100 Index is down by 1.3 percent and the French CAC 40 Index is down by 0.9 percent.

In the bond market, treasuries have moved slightly higher amid the weakness on Wall Street. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 1 basis point at 1.392 percent.

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