Wall Street stocks tumbles on Omicron variant warning

Nov 30 Reuters - Wall Street's main indexes were set to fall sharply on Tuesday after a warning from Moderna's chief executive on the effectiveness of COVID 19 shots against the Omicron variant hammered travel, energy and banking shares.

Moderna CEO St phane Bancel told the Financial Times that the current vaccine crop would need to be modified. Global equity markets tumbled after Moderna CEO St phane Bancel told the Financial Times that it was likely that the current crop of vaccines would need to be modified.

Regeneron Pharmaceuticals Inc said its COVID 19 antibody treatment, along with other similar drugs, could be less effective against the Omicron variant.

Peter Cardillo, chief market economist at Spartan Capital Securities in New York, said that this new variant has caused the market's worst enemy to accelerate, and that is uncertainty.

I don't think the market will collapse here, but I do expect a lot of days like we're seeing now, you go down a 1 -- 1 2%, then rally a bit and go back down one step forward and two steps back. Occidental Petroleum led losses among energy shares with its stock down by 3.5% in premarket trading, as oil prices slumped nearly 3% due to demand concerns.

Major Wall Street lenders sank, tracking a dip in Treasury yields as safe haven demand kept bond buying high. Bank of America was the biggest loser among peers, down 2%.

American Airlines Group fell the most among airline stocks, which were down between 1.5% and 1.9%. Cruise operators Carnival Corp, Royal Caribbean and Norwegian Cruise Line dropped about 2% each.

Wall Street's main indexes rebounded on Monday from Friday's deep sell-off, as investors were hopeful that the Omicron variant would not lead to lock downs, despite reassurances from U.S. President Joe Biden.

The uncertainty about the new variant has sparked a fresh alarm at a time when central banks are contemplating a return to pre-pandemic monetary policy to deal with a surge in inflation as supply chain logjams are weighing on economic recovery.

Dow's e-minis were down 400 points, or 1.14%, S&P 500 e-minis were down 45 points, or 0.97%, and Nasdaq 100 e-minis were down 93 points, or 0.57%, according to ET.

The S&P 500 and the tech-heavy Nasdaq are down 1.9% and 2.7% from their record highs earlier this month, while the blue-chip Dow has slipped 3.9%.

Treasury Secretary Janet Yellen and Federal Reserve Chair Jerome Powell are due to testify before the U.S. Senate Banking Committee at 10 a.m. Powell said he continues to expect inflation to recede over the next year, but he warned that the new variant of COVID 19 muddies the outlook, and prices could continue to rise longer than previously thought.

The November readings of Chicago PMI and consumer confidence data will be later in the day.

Stay-at- home stocks, which benefited the most during the lock down, such as Netflix Inc, Teladoc Health, Peloton Interactive and Zoom Video Communications rose between 0.7% and 1.7%.