As vaccination rates have increased, the economy has slowly reopened and investors focused more on the lingering effects of the shutdowns that were necessary before inoculation was possible.īut the Omicron variant - which triggered travel restrictions almost immediately after it was identified - snapped many people back to those early days. The past year has been, overall, a remarkable stretch - the S&P is up nearly 24 percent for the year, in large part because of the arrival of highly effective vaccines.

On Sunday, William Ackman, the billionaire founder of Pershing Square Capital Management, struck a hopeful tone on Twitter: If the Omicron variant is more easily transmissible but also more mild, he suggested, it would bode well for stock prices that have risen with only brief interruptions since plunging in the early days of the pandemic. That hasn’t stopped speculation, of course.

“Today, for anybody in the market to say that, ‘Yes, we should absolutely be buying the dip based on just the Omicron news,’ I think it’s just guesswork, for anybody.

“We just have to deal with this, and with any new variants that we get, with a little bit of humility,” said Gargi Chaudhuri, head of iShares Investment Strategy, Americas at the asset management firm BlackRock. In New York, the S&P 500 opened sharply lower amid new concerns over the ability of current vaccines to control Omicron. Now the markets face weeks of uncertainty and increased volatility as investors once again closely watch public health updates arriving hour by hour, analysts said.Īfter a solid rally on Monday - the S&P 500 rose 1.3 percent, recovering some of the ground lost in a panicky slide on Friday - global markets were sliding again on Tuesday. Investors and analysts have snapped their attention back on the virus as they try to assess the myriad ways the concerning new iteration could undermine an often overlooked source of market confidence this year: the effectiveness of vaccines. The Omicron variant changed that almost overnight. There were positive signs the economy was rebounding, and investors’ biggest worry was how quickly the Federal Reserve would pivot away from the market-boosting policies that have helped stocks soar in the past year and a half. On Wall Street, the end of the pandemic appeared tantalizingly close just a week ago.

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