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Tech rally lifts Wall Street from Omicron-driven rout

Longs in technology stocks pushed Wall Street higher on Monday after an Omicron-related decline, while the Dow Jones Industrial Average lagged behind its peers as major banks slumped and investors expected more information on a new alternative to the coronavirus.


The S&P tech sub-index (.SPLRCT) jumped 2.1%, indicating that investors likely prefer pandemic-resistant technology stocks amid growing concerns over Omicron.


Gains in Amazon.com (AMZN.O) and Tesla Inc (TSLA.O) also pushed the discretionary consumer S&P segment (.SPLRCD) up 1.7%, as investors view Friday’s losses as a signal to search for deals in tech names high value.


“People are looking at it as a small sell-off on Friday and an opportunity to get into some hard-hit market areas,” said Robert Pavlik, senior portfolio manager at Dakota Wealth Management.

Wall Street indexes fell between 2.0% and 3.5% on Friday after news of the Omicron variable. Investors are now awaiting an update from President Joe Biden on the virus and the country’s response, scheduled for later today.


Twitter Inc (TWTR.N) trimmed early gains and traded 0.1% lower after the social media company said CEO Jack Dorsey will step down and be succeeded by Chief Technology Officer Parag Agrawal. The move ends Dorsey’s tenure as CEO of two major technology companies, the second being digital payments company Square Inc (SQ.N).


Square shares fell 0.4 percent.


The Dow Jones (.DJI) was significantly behind its peers, with major bank stocks the heaviest weighted after Treasury yields plunged from today’s highs.


Investors have been considering a possible delay in the Federal Reserve’s plans to raise interest rates, in light of the new virus variable.


said Thomas Hayes, managing director of Great Hill Capital LLC, New York.


Merck & Co Inc (MRK.N) stock fell 4.5% and was also among the biggest decliners on the Dow Jones Index. The stock extended losses Friday after updated data from a study of the experimental COVID-19 pill showed less effectiveness in reducing hospitalization and mortality risks than previously reported.


At 11:37 AM ET, the Dow Jones Industrial Average (.DJI) rose 136.63 points, or 0.39%, at 35.035.97 and the S&P 500 (.SPX) rose 50.66 points, or 1.10%, to 4,645.28 points. The Nasdaq Composite Index (.IXIC) rose to 232.46 points, or 1.50%, to 15,724.11 points.


Among other stocks, casino operators Wynn Resorts (WYNN.O) and MGM Resorts International (MGM.N) fell 3.8% and 1.8%, respectively, tracking losses at their Macau units, which were rocked by arrests over alleged cross-border links. Gambling and money laundering.


Advanced Micro Devices (AMD.O) is up 2.5% after a report that electric car maker Tesla is starting to use a new AMD chip in Model Y cars in China.


Tesla shares rose 4.6% after a report that CEO Elon Musk urged employees to reduce the cost of car delivery.


Apple Inc (AAPL.O) rose 1.9% after HSBC raised its target price for the iPhone maker’s stock.


Declining issues outnumbered advancers by 1.06 to 1 on the New York Stock Exchange and 1.51 to 1 on the Nasdaq.


The S&P recorded four new 52-week highs and 15 new lows, while the Nasdaq recorded 29 new highs and 215 new lows.

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