Stock futures climbed in overnight trading Monday following a broad sell-off amid fears about the fast-spreading omicron Covid variant.
Futures on the Dow Jones Industrial Average gained 110 points. S&P 500 futures rose 0.3% and Nasdaq 100 futures climbed 0.5%.
The overnight action came after a losing day on Wall Street with low trading volume ahead of the holidays. The blue-chip Dow dropped more than 400 points for its third negative session in a row. The S&P 500 and the Nasdaq Composite both declined more than 1% Monday. The S&P 500 had its biggest three-day drop since September, falling 3% over the period.
The omicron surge has kept investors on edge with the variant now found in at least 43 states and 90 countries. Officials with the World Health Organization said omicron is more contagious than any previous variant of Covid-19. Omicron accounted for 73% of new infections in the U.S. last week, federal health officials said Monday.
Monday’s sell-off erased the S&P 500’s earlier gains in December, pushing the equity benchmark to the flatline this month. The Dow is up about 1.3% this month, while the Nasdaq is down nearly 3.6%, on pace to break a two-month winning streak.
“As we head into the shortened holiday week amid surging Omicron cases, continued supply chain pressures, and the failure of the Build Back Better plan, increased volatility and thinner trading volumes could cause the market to overreact, which could be a buying opportunity in the run-up to Christmas,” said Mark Hackett, Nationwide’s chief of investment research.
Investors also assessed the prospect for President Joe Biden’s economic agenda. The Senate will vote on Biden’s sweeping social safety net and climate policy bill in January despite Sen. Joe Manchin’s opposition to it. It is unclear if Democrats will try to pass a smaller bill that includes only parts of the full package.