Stock Market Today

Stock Market Today: Optimism on Omicron Gives Stocks a Kick

"Encouraging" preliminary data on the omicron strain's severity sparked every market sector to gains on Monday.

The Dow Jones Industrial Average and the other major indexes enjoyed a caffeinated start to the trading week as some encouraging commentary about the COVID omicron strain went a long way toward re-energizing the bulls.

White House Chief Medical Advisor Anthony Fauci told CNN on Sunday that while preliminary data shows that omicron "has a transmission advantage" in South Africa, "thus far it does not look like there's a great degree of severity to it."

While Fauci added that it's too early to make any definitive statements, Wall Street clearly heard what it wanted, as a widespread rally ensued today.

Unsurprisingly, economically sensitive sectors such as industrials (+1.7%), energy (+1.5%) and financials (+1.5%) benefited the most. Travel-related plays enjoyed a boost as well – Norwegian Cruise Line Holdings (NCLH, +9.5%), United Airlines (UAL, +8.3%), Las Vegas Sands (LVS, +7.2%) and Expedia (EXPE, +6.7%) were among Monday's most noteworthy gainers.

The industrial average led the way with a 1.9% gain to 35,227, while the S&P 500 improved by 1.2% to 4,591. Technology (+0.9%), while up, still lagged most other sectors, limiting the Nasdaq Composite's advance (+0.9% to 15,225).

Sign up for Kiplinger's FREE Investing Weekly e-letter for stock, ETF and mutual fund recommendations, and other investing advice.

stock chart for 120621

YCharts

Other news in the stock market today:

  • The small-cap Russell 2000 popped 2.1% to 2,203.
  • Easing omicron fears sent U.S. crude futures spiking 4.9% to settle at $69.49 per barrel.
  • Gold futures slipped 0.3% to end at $1,779.50 an ounce.
  • Bitcoin prices were 8.6% lower from Friday afternoon's prices, though most would consider that a relief, as the digital coin bottomed out around $43,000 over the weekend. "There wasn't a clear catalyst that triggered the selloff with most pointing to deleveraging of risk assets," says Michael Reinking, senior market strategist for the New York Stock Exchange. (Bitcoin trades 24 hours a day; prices reported here are as of 4 p.m.)
  • Jack in the Box (JACK) sat out today's broad-market move higher, sinking 4.1% after the fast-food chain said it is buying sector peer Del Taco Restaurants (TACO) for $575 million, including debt, or $12.51 per TACO share. TACO jumped 66.1% on the day.
  • Buzzfeed (BZFD) is the latest stock to debut on Wall Street. The media company went public via a merger with special purpose acquisition company (SPAC) 890 5th Avenue Partners. BZFD stock opened for trading at a per-share price of $10.95 and reached a session high of $14.77 before turning tail and settling at $8.56 – an 11.0% decline.
  • Walgreens Boots Alliance (WBA, +3.8%) was the best Dow stock today after Bloomberg reported late Friday that the pharmacy retail chain is exploring the potential sale of spinoff of Boots, it's U.K.-based drugstore. UBS Global Research analyst Kevin Caliendo says the reports don't come as a total surprise, "given the strategic shift toward healthcare management [WBA] highlighted at its analyst day and the emphasis management placed on the value it thought it had in its various and disparate assets (Boots, China, ABC, etc.)." If the company chooses to divest Boots, Caliendo expects Walgreens to "redeploy any proceeds to offset dilution or perhaps to help fund its Health M&A or Health Organic segments growth." He currently has a Neutral rating on the Dow stock.

Embrace the Volatility?

Up days like today aren't just nice because of the gains – they also help investors take a moment to collect themselves.

The markets have been a volatile mess ever since after Thanksgiving, when news of the omicron strain snatched headlines. We might not be done with the roller coaster, either, but Ryan Detrick, LPL Financial chief market strategist, has some words of encouragement:

"After more than a 110% rally from the March 2020 lows, perhaps investors needed a reminder that stocks can't go up forever and that while volatility might be frustrating, it is perfectly normal," he says. Ultimately, however, "We aren't minimizing the omicron uncertainty, but we remain bullish that the recovery is alive and well, with a very healthy consumer and corporate earnings backdrop leading the way.

"In the end, we expect any lost output due to omicron to simply be pushed out and recovered by early next year."

What should you do until then?

We provide a broad overview in our markets lookahead to 2022, though investors can find a multitude of sector-specific and other tactical picks in our investing outlook.

However, if your comfort zone is the market's biggest, most financially stable companies – regardless of what headlines are whizzing past – look no further than this list of the hedge fund community's favorite blue-chip stocks. The "smart money" has recently filed to reveal their latest comings and goings, and these 25 stocks represent their collective highest-conviction ideas.

Most Popular

The 15 Best Stocks for the Rest of 2022
stocks to buy

The 15 Best Stocks for the Rest of 2022

The lesson of the past two years: Be ready for anything. Our 15 best stocks to buy for the rest of 2022 reflect several possible outcomes for the seco…
June 21, 2022
Your Guide to Roth Conversions
Special Report
Tax Breaks

Your Guide to Roth Conversions

A Kiplinger Special Report
February 25, 2021
The Best Bank for You, 2022
Making Your Money Last

The Best Bank for You, 2022

Check out our list of the best candidates for your next financial institution based on interest rates, fees and other features.
June 23, 2022

Recommended

Stock Market Today (6/24/22): Stocks Stick the Landing in Successful Short Week
Stock Market Today

Stock Market Today (6/24/22): Stocks Stick the Landing in Successful Short Week

Small hints that inflation might have peaked and that the U.S. might evade recession stoked broad buying Friday.
June 24, 2022
Could Buffett Buy Out Occidental (OXY)?
stocks

Could Buffett Buy Out Occidental (OXY)?

All in, Berkshire Hathaway now owns a third of energy firm Occidental Petroleum. One analyst thinks Buffett might make a play for the rest.
June 24, 2022
Kiplinger's Weekly Earnings Calendar
stocks

Kiplinger's Weekly Earnings Calendar

Check out our earnings calendar for the upcoming week, as well as our previews of the more noteworthy reports.
June 24, 2022
Stock Market Today (6/23/22): Safety-Seeking Investors Drive Stocks Higher
Stock Market Today

Stock Market Today (6/23/22): Safety-Seeking Investors Drive Stocks Higher

Investors piled into bonds and yield-bearing sectors such as utility stocks and consumer staples Thursday as the economy's fate continues to be shroud…
June 23, 2022