Stocks traded mixed to pause after a two-day rally, as investors further considered updates around the Omicron variant and weighed a potential policy pivot by the Federal Reserve.
A day earlier, technology stocks outperformed to pull the Nasdaq higher by more than 3%, in its best day since March. As of Tuesday's close, the S&P 500 was less than 0.5% below its levels from Nov. 24, or the session before the World Health Organization's announcement of the Omicron's discovery.
Treasury yields steadied after a jump on Tuesday, and the yield on the 10-year Treasury note traded just below 1.5%. U.S. West Texas intermediate crude oil futures hovered around $71 per barrel, while Bitcoin slipped back near $50,000.
Investors have snapped up risk assets so far this week amid prospects that the Omicron variant may not pose as severe a health threat as previously feared. And elsewhere, the latest developments in Washington, D.C., indicated lawmakers were on track to raise the debt-ceiling before a Dec. 15 deadline, which if not extended would leave the U.S. Treasury without sufficient funds to repay U.S. debt holders. The House of Representatives voted Tuesday night to approve a bill paving the way for Senate lawmakers to raise the limit with a simple majority vote.
Pfizer (PFE) shares traded slightly higher after the company said that three doses of its Pfizer-BioNTech (BNTX) vaccine "neutralize" the Omicron variant, while noting that two doses "may not be sufficient to protect against infection" with Omicron. Other recent developments around the virus have also been upbeat, with Dr. Anthony Fauci telling the AFP on Tuesday that Omicron infections are "almost certainly" not more severe than those caused by the previous Delta variant.
"Economic growth is going to be strong. Certainly the Omicron variant could possibly push some of that out, but it won't eliminate it given the underlying fundamentals," Brent Schutte, chief investment strategist for Northwestern Mutual, told Yahoo Finance Live. "And the Federal Reserve certainly will focus a bit more on tapering — that kind of spooked the market — but ask yourself: What impact is that going to have on growth? The answer to us is not much. You are still going to have a strong U.S. economy next year on the back of reopening, on the back of all the cash that is still available on the consumer balance sheet."
Other strategists echoed these sentiments.
"We do think that there is fundamental support there for markets to continue to move higher here," Emily Roland, co-chief investment strategist at John Hancock investment management, told Yahoo Finance Live on Tuesday. "Obviously we had a couple of things spook us over the last week or so, the emergence of the Omicron variant as well as this pivot from the Fed, potentially seeing them accelerating their tapering of asset purchases here. But the bottom line is that the economy is strong."
"So until it looks like we're inching closer to a recession here, which we're nowhere near at this point, it's hard for us to get too defensive," she added. "We continue to embrace equities, we like the U.S. the most, that's where we're seeing the best relative economic growth, that's where we're seeing the best relative earnings growth. And again, the other element here is that there is a ton of cash on the sidelines that's looking to get put to work."
4:09 p.m. ET: Stocks eke out third straight day of gains after Pfizer says third dose of vaccine neutralizes Omicron
Here were the main moves in markets as of 4:09 p.m. ET:
S&P 500 (^GSPC): +14.46 (+0.31%) to 4,701.21
Dow (^DJI): +35.32 (+0.10%) to 35,754.75
Nasdaq (^IXIC): +100.07 (+0.64%) to 15,786.99
Crude (CL=F): +$0.54 (+0.75%) to $72.59 a barrel
Gold (GC=F): +$2.10 (+0.12%) to $1,786.80 per ounce
10-year Treasury (^TNX): +2.9 bps to yield 1.5090%
11:11 a.m. ET: Crude oil inventories dropped less than expectedT last week: EIA
The Energy Information Administration said in its weekly report Wednesday that U.S. crude oil inventories dropped by 241,000 barrels last week.
The sum was much less pronounced than the drop of 1.521 million barrels consensus economists were expecting, based on Bloomberg data. The weekly report also spotlighted that crude imports fell by 105,000 barrels per day, while crude production increased by 100,000 barrels per day.
U.S. West Texas intermediate crude oil futures ticked down by about 0.3% Wednesday morning, to give back some gains after jumping by 3.7% on. Tuesday and 4.9% on Monday. Brent crude oil futures, the international benchmark, edged lower by about the same margin to hover above $75 per barrel.
10:00 a.m. ET: Job openings climb to near-record high in October
Job openings in the U.S. jumped by a greater-than-expected margin in October, underscoring the still-widespread mismatches in labor supply and demand as shortages abound.
The Labor Department said Wednesday that U.S. job openings totaled 11.033 million in October, coming in above consensus economists' expectations for 10.469 million, according to Bloomberg data. Job openings in September were upwardly revised to 10.602 million, from the 10.438 million previously reported.
The quits rate came down only slightly in October to reach 2.8%, versus September's all-time high of 3.0%.
9:30 a.m. ET: Stocks open higher amid Pfizer vaccine news
Stocks traded mixed and came off the highs of the overnight session as investors continued to digest new updates on Pfizer's COVID-19 vaccine and its efficacy against the Omicron variant.
The Dow traded higher by more than 100 points, or 0.3%. The S&P 500 was little changed, while the Nasdaq dropped 0.2%.
Small-cap stocks continued to jump, with the Russell 2000 index up another more than 2%.
7:32 a.m. ET Wednesday: Stocks head for third straight session of gains
Here's where markets were trading ahead of opening bell:
S&P 500 futures (ES=F): +13.5 points (+0.29%), to 4,698.50
Dow futures (YM=F): +114.00 points (+0.32%), to 35,827.00
Nasdaq futures (NQ=F): +39.75 points (+0.24%) to 16,357.75
Crude (CL=F): -$0.01 (-0.01%) to $72.04 a barrel
Gold (GC=F): +$1.00 (+0.06%) to $1,785.70 per ounce
10-year Treasury (^TNX): -0.8 bps to yield 1.472%
6:06 p.m. ET Tuesday: Stock futures open higher after rally
Here were the main moves in markets in late trading on Tuesday:
S&P 500 futures (ES=F): +3 points (+0.06%), to 4,688.00
Dow futures (YM=F): +9 points (+0.03%), to 35,722.00
Nasdaq futures (NQ=F): +21.5 points (+0.13%) to 16,339.5
Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter