US stocks higher midday as Omicron concerns ease

12.05pm: Dow advances more than 600 points

US stocks were higher in noon trading following reports from South Africa that the new coronavirus (COVID-19) Omicron variant is milder in nature.  

At midday, the Dow climbed 603 points to 35,183, while the S&P 500 added 40 points at 4,579 and the tech-heavy Nasdaq gained 32 points to 15,117.    

“Super-cap tech has been well bid on the expectation of ‘forever’ low rates and support,” Sevens Report author Tom Essaye said.

“But with the prospect of rates rising and this new Fed paradigm, we are seeing investors rotate out of tech and into sectors with better exposure to higher growth,” Essaye added.

Notable movers included shares of Apple Inc (NASDAQ:AAPL), which gained nearly 3% as analysts at KeyBanc Capital Markets initiated coverage on the stock with an “Overweight” rating and a price target of $191 per share, saying Apple’s large and growing user base provides “a solid foundation for growth.”

11am: Proactive North America headlines:

RedHill Biopharma says opaganib proposed mechanism of action not impacted by spike protein mutations, including Omicron mutations; provides update on regulatory submissions for opaganib

Sigma Lithium kicks off production plant construction at its Grota do Cirilo project in Brazil

CO2 GRO announces sale of its CO2 Delivery Solution System to a Tennessee-based hemp grower

Esports Entertainment says ggCircuit brand to install ALPHA software at four Simplicity Esports and Gaming Company locations

Royal Wins Corp appoints lawyer Charles Vycichl to its board of directors

NEO Battery launches three silicon anode material products for high-performance lithium-ion batteries

Zoglo’s Incredible Food posts record 3Q revenue of $1.7M as new plant-based products see strong sales across Canada

PlantX Life launches its e-commerce platform in the UK

ElectraMeccanica (NASDAQ:SOLO) delivers 42 SOLO EVs to reservation and fleet holders

Champion Gaming (TSX-V:WAGR) strikes strategic partnership with basketball analytics company Inpredictable

Safe-T successfully deploys its ZoneZero ZTNA solution in India and South-East Asia

MAS Gold moving towards 1M gold ounce goal in Saskatchewan with updated Greywacke North resource

Karora Resources appoints Australian resource veteran Shirley In’t Veld to its board of directors

Enveric Biosciences (NASDAQ:ENVB) appoints Bob Dagher as its chief medical officer

Psyched Wellness (CSE:PSYC, OTCQB:PSYCF) wraps up 90-day oral toxicity study on AME-1, its Amanita Muscaria extract

Victory Square portfolio company Next Decentrum in partnership to bring ancient Egypt to life in the metaverse

Mydecine files patent application to cover multiple families of psilocin analogs

Lumina Gold inks Exploration Investment Protection Agreement for its Cangrejos project in Ecuador

Idaho Champion (CSE:ITKO, OTCQB:GLDRF) Gold Mines Canada has now outlined eight square-kilometre anomaly at Champagne gold project

XPhyto Therapeutics completes strategic acquisition of 3a-diagnostics GmbH

Bam Bam Resources (CSE:BBR) awaiting assays after completing this year’s drilling at Majuba Hill, Nevada

PowerTap Hydrogen Capital says its modular hydrogen production and dispensing system saw ‘tremendous success’ at Expo 2020 in Dubai

9.47am: US stocks start mixed

US stocks were mixed on Monday’s open with the Dow Jones surging but the Nasdaq slumping as coronavirus (COVID-19) variant fears continue to circulate and weigh on sentiment.

In early deals in New York, the Dow Jones Industrial Average advanced over 281 points to stand at 34,861. The S&P 500 added around six points at 4,543.

But the tech-laden Nasdaq exchange lost 144 points to sit at 14,941.

“Market volatility has picked up significantly since Omicron made the headlines the week before last,” said Rupert Thompson, the chief investment officer at wealth management group Kingswood.

“US equities have seen daily moves of 1-2% most days, with gains replacing losses and losses gains, day by day. Even so, the overall trend has been downwards.

“Global equities ended the week 1.1% lower in local currency terms and are now off 4.2% from their mid-November high,” he added.

“Omicron has reawakened dormant fears that a vaccine-resistant variant might emerge. As yet, however, it is more a case of what we don’t know, rather than what we do know. While it is fairly clear that Omicron is considerably more transmissible than Delta, it is still unclear how vaccine-resistant it is and how severe the resulting infection could be.”

6.45am: US stocks set for mixed start

US stocks look set for a mixed start to the new week after Friday’s drop, with disappointment over November US payrolls balanced by signs that worries over the coronavirus Omicron variant have eased slightly.

Futures for the Dow Jones Industrial Average futures added 0.7% on Monday, recovering after Friday’s falls, but those for the S&P 500 edged up less than 0.1%, and tech-laden Nasdaq-100 futures fell 0.5%. Pre-weekend, the Dow shed 0.2%, while the S&P 500 index lost 0.8%, and the Nasdaq Composite dropped 1.9%. 

Markets have been volatile over the past few weeks amid conflicting signals from scientists and vaccine makers regarding the severity of the Omicron variant and how well existing vaccines may work against it. 

However, some positive news emerged over the weekend when a small study of people hospitalized from Omicron in South Africa found a pattern of milder illness than in previous waves of coronavirus (COVID-19), though scientists remained cautious noting the limited size of the study.

US chief medical adviser Anthony Fauci told CNN over the weekend that there does not appear to be a “great deal of severity” to Omicron, adding the same caveat.

Meantime, regulators said Sunday that the US Food and Drug Administration planned to streamline authorization for revamped vaccines, and President Biden outlined plans for combating Omicron, which includes access to booster shots for all adults, a mask mandate on public transportation and tightened rules for international travelers.

On the corporate front, Science Applications International is scheduled to report earnings ahead of the Monday opening bell and Coupa Software and Healthequity after markets close. Earnings from home builder Toll Brothers are planned for tomorrow and Campbell Soup and GameStop are scheduled for Wednesday, while Lululemon, Costco and Oracle are expected to post earnings Thursday.

Among commodities, oil prices rose on expectations for higher energy demand as lockdown fears receded and Saudi Aramco raised its official selling prices for all grades of crude into Asia for January. 

Meanwhile, Bitcoin and other cryptocurrencies edged higher after a weekend sell-off.

Marcus Sotiriou, sales trader at the UK-based digital asset broker GlobalBlock commented: “The crypto markets took a nosedive in the early hours of Saturday morning as a global rout across all risk assets took hold. Bitcoin fell from $53,890 to $42,000 approximately, causing most altcoins to collapse with it. This drop blindsided a large amount of investors, as many were expecting a rally going into year-end. However, digital asset markets have seen huge amounts of selling from crypto ‘whales’ who have been moving Bitcoin from the wallets and depositing to exchanges at a staggering rate.”

He added: “The crash was also down to a cascade in liquidations, as over $2 billion of leveraged positions was wiped out on Saturday. This deleveraging was exacerbated by the fact that it occurred on a Friday night in the US coinciding with the weekend in Asia, which is one of the lowest periods for liquidity. This meant that even though leverage was actually lower than it has been in previous crashes, the effect was still substantial. This shows that event though markets have become more efficient over time, it still has a long way to go to avoid these situations of forced selling.”