By Yasin Ebrahim
Investing.com – The S&P 500 eased from highs Wednesday, as investors weighed an upside surprise in monthly private job gains against ongoing concerns about the Omicron strain of Covid-19 after the U.S. reported its first case of the new variant.
The S&P 500 rose 0.67%, the Dow Jones Industrial Average gained 0.35%, or 20 points, and the Nasdaq added 0.25%.
U.S. health officials confirmed Tuesday that the first case of the Omicron variant of Covid-19 was identified in California, but stressed that there was still a need to wait for further data to determine how transmissible and how effective the new strain is at evading current vaccines.
Private payrolls grew by 534,000 in November, less than the 570,000 in October, but ahead of expectations for 525,000.
The better-than-expected jobs data comes just days ahead of the monthly nonfarm payrolls due Friday, and strengthened expectations for the Federal Reserve to step up the pace of bond tapering.
In his second day of testimony on Capitol Hill, Fed Chair Jerome Powell continued to reiterate that speeding up the taper of bond purchases would be on the agenda at the September meeting, but added that there was no reason for faster taper to be disruptive to markets.
Despite the rebound in the broader market, investor sentiment still appears to be skittish as the utilities, a typically defensive corner of the market, led the move to the upside.
AES Corporation (NYSE:AES), Alliant Energy (NASDAQ:LNT), WEC Energy (NYSE:WEC) were among the biggest gainers.
In another boost to utilities, which also serve a bond proxy, treasury yields gave up some gains following their intraday surge, with the 10-year U.S. Treasury yields eased further below 1.5%.
Health care stocks were pushed higher by a more than 7% surge in Vertex Pharmaceuticals (NASDAQ:VRTX) after the pharmaceutical company reported a positive update from its mid-stage focal glomerular sclerosis study.
Moderna (NASDAQ:MRNA), meanwhile, slumped more than 8% after losing an appeal against a court ruling on patents – used in the making of its Covid-19 vaccine – held by Arbutus Biopharma (NASDAQ:ABUS). Arbutus surged 71%.
In energy, Exxon Mobil (NYSE:XOM) was in focus after the oil major forecast a doubling of earnings and cash flow by 2027 amid plans to lower capital expenditure.
In tech, Apple (NASDAQ:AAPL) added to gains from a day earlier as some on Wall Street highlighted improving signs of improving supply chain pressures that could help the tech maker roll out its latest line of iPhones.
Citing signs of improved wait times for iPhones, UBS forecasts Apple to sell 80 million iPhones in the December quarter, compared with 82 million last year.
Twitter (NYSE:TWTR), meanwhile, was up more than 2% after Cathie Wood revealed that ARK purchased 1.1 million shares of the social media company on Tuesday, amid optimism about the future of the company under the leadership of new Chief Executive Parag Agrawal.