Stocks rose broadly on Wall Street Monday as markets regain their footing following a big stumble on Friday on worries about the spread of the new variant of the coronavirus.
The S&P 500 rose 1% as of 9:44 a.m. Eastern. The benchmark index slumped 2.3% on Friday for its worst day since February. The Dow Jones Industrial Average rose 192 points, or 0.6%, to 35,073 and the Nasdaq rose 1.2%.
Technology companies made some of the biggest gains. Apple rose 2.2% and Microsoft rose 2.4%. A wide range of retailers and other companies that rely on consumer spending also made solid gains. Amazon rose 1.3% and Nike rose 1.4%.
Travel-related stocks, which suffered on Friday, regained some ground. Marriott rose 3.2% and Expedia rose 2.7%. U.S. crude oil prices jumped 5.7%.
Like stocks, the bond market and other corners of Wall Street also steadied themselves following Friday’s knee-jerk reaction to run toward safety and away from risky investments. With vaccines in hand, the world may be in better position to weather this newest potential wave. Plus, Friday’s market moves may have been exacerbated by many professional traders taking the day off following Thanksgiving.
“So as the initial shock wears off a bit, traders could be eyeing opportunities and coming to terms with the possibility of some short-term volatility associated with a potential new wave,” Chris Larkin, managing director of trading at E-Trade Financial, said in a statement.
The yield on the 10-year Treasury climbed to 1.55% from 1.49% late Friday, recovering nearly half its steep slide from that day. It tends to rise and fall with expectations for the economy’s strength and for inflation.
The yield on the two-year Treasury, meanwhile, climbed as traders reconsidered guesses made on Friday that omicron would push the Federal Reserve to delay raising interest rates. It rose to 0.54% from 0.50% late Friday.
Investors are now pricing in a 67% probability that the Fed will raise rates from their record low of nearly zero by mid-June. On Friday, when omicron worries raised questions about whether the economy will need more help through low rates, investors cut that probability down to 62%.
Despite the reversal from Friday for yields and other areas of the market, they’re still below where they were before concerns about omicron blew through markets.
Consider the VIX, an index that measures how worried investors are about upcoming drops for the S&P 500. It eased by more than 14% to 24.44, but it’s still well above where it was before Thanksgiving, at 18.58.
The broader market has been gaining ground since early in 2021 when vaccines were rolled out in an effort to fight the virus pandemic that stunned the global economy in 2020. Much of the concern for investors has focused on rising inflation potentially crimping what has been a solid recovery. COVID-19 has remained a lingering concern.
A surge in cases from the delta variant stunted consumer spending and worried investors over the summer. The latest threat from COVD-19 comes from the omicron variant, which was first detected in South Africa and appeared to be spreading across the globe. The European Union and the U.K. both announced travel restrictions from southern Africa on Friday. The U.S. also put travel restrictions on those coming from South Africa as well as seven other African nations.
The threat of a new surge in cases comes threatens stun the global economy just as people are planning to travel for the holidays and businesses are relying on holiday shoppers. It could also complicate planning by central banks that are deciding when and how to withdraw stimulus measures that have helped keep interest rates low and aided stocks.
AP Business Writer Stan Choe contributed.