By Mark DeCambre and Barbara Kollmeyer
The U.S. stock market started December the same way it ended November, with a whipsaw trading session that saw the Dow Jones Industrial Average swing by nearly 1,000 points from peak to trough, ushering in an unsettling phase of volatility in the final month of 2021.
How are stock-index futures trading?
The S&P 500 index /zigman2/quotes/210599714/realtime SPX +0.40% declined 53.96 points, or 1.2%, to close at 4,513.04, after hitting an intraday peak at 4,652.94.
The large-cap benchmark ended the session below its 50-day moving average at 4,539.32.
The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA +0.76% fell 461.68 points, or 1.3%, to end at 34,022.04, after establishing a Wednesday peak at 35,004.64, up around 520 points.
The Dow closed below its 200-day moving average at 34,361.27 for the first time since July.
The Nasdaq Composite Index /zigman2/quotes/210598365/realtime COMP -0.21% fell 283.64 points, or 1.8%, to reach 15,254.05, but had registered an intraday peak at 15,816.82.
The Nasdaq Composite closed beneath its short-term, 50-day moving average at 15,266.03.
The Russell 2000 index RUT slid 2.3% to 2,147.42, and marked its first correction since June of 2020.
On Tuesday , the Dow industrials dropped 652.22 points, or 1.9%, to 34,483.72. The S&P 500 fell 1.9%, while the Nasdaq Composite declined 1.6%.
What’s driving the markets?
Equity indexes squandered what had been shaping up to be a solid rebound, falling after Dr. Anthony Fauci, President Joe Biden’s top medical adviser, said the U.S. confirmed its first case of the omicron variant of the coronavirus that causes COVID-19.
The comments come a day after the market swooned on a combination of hawkish comments from Federal Reserve Chairman Jerome Powell and worries surrounding the new strain of coronavirus that has been rattling investors.
Fauci said that “the California and San Francisco departments of public health and the CDC have confirmed that a recent case of COVID-19 among an individual in California was caused by the omicron variant.”
Although the eventual emergence of a U.S. case was widely expected, comments from the public health specialist took the wind out of the market’s sails, which had enjoyed a decidedly more optimistic tone earlier on Wednesday.
Investors had even shrugged off Powell’s latest remarks, after he reiterated his view that the central bank might have to tighten financial conditions soon to combat surging inflation from new variants of COVID such as omicron, testifying for a second day in front of lawmakers about the state of the economy in the face of the COVID-19 pandemic. Powell tempered his remarks by saying that “the taper need not be a disruptive event in markets, I don’t expect that it will be. It hasn’t been so far — we telegraphed it.”
Markets appeared to be in a more sanguine mood even before Powell’s Wednesday testimony, as investors parsed private payrolls in the U.S., which rose by 534,000 in November, according to the ADP National Employment Report released Wednesday. Economists polled by The Wall Street Journal had forecast a gain of 506,000 private-sector jobs in November.