Wall Street closed significantly higher on Tuesday after a bruising session the prior day. Image Credit: AP

New York: Wall Street closed significantly higher on Tuesday after a bruising session the prior day, with oil prices also gaining as investors sought riskier assets despite surging cases of the Omicron coronavirus variant

US President Joe Biden said on Tuesday he would be taking steps to fight the Omicron variant by opening federal testing sites in New York City and buying 500 million at-home tests Americans can order online for free.

World shares had fallen earlier in the week after Omicron infections multiplied around the world, but strong corporate earnings and reports that Moderna Inc’s COVID-19 vaccine provides protection against the variant gave investors hope on Tuesday. US stocks had also taken a hit after Biden’s $1.75 trillion spending bill was dealt a potentially fatal blow on Sunday.

Year-end rally

“We think this was kind of overdue over the past couple of weeks. We’re kind of set up for a rally in time for Santa Claus, which officially begins next Monday,” said Scott Brown, technical market strategist at LPL Financial, explaining that a so-called Santa Claus rally can happen in the last five trading days of the year and first two of the new year.

“We think we’ve had a little bit of a washout. We saw a lot of fear rush into the market.” The Dow Jones Industrial Average rose 1.6 per cent to 35,492.7, and the S&P 500 gained 1.78 per cent to 4,649.23. The Nasdaq Composite added 2.4 per cent to close at 15,341.09.

MSCI’s gauge of stocks across the globe gained 1.61 per cent.

Oil gains

Oil prices settled up more than 3 per cent despite signs of improving supply and concerns the spread of Omicron would curb travel and crimp demand for fuel.

Brent crude settled up $2.46, or 3.4 per cent, at $73.98 a barrel, and US West Texas Intermediate (WTI) crude rose $2.51, or 3.7 per cent, to $71.12 a barrel.

Indian shares rise 

Indian shares edged up on Wednesday as auto and metal companies gained with investors buying the dip, while Omicron coronavirus variant cases across the globe continued to surge keeping sentiment in check.

The NSE Nifty 50 index rose 0.62 per cent to 16,875 by 0359 GMT and the benchmark S&P BSE Sensex gained 0.86 per cent at 56,702.92. Both the indexes are down nearly 10 per cent from a lifetime high hit in October.

The Nifty auto index was up 1.6 per cent, while the metals index gained 1 per cent.

Asian markets follow Wall Street
Asian stock markets followed Wall Street higher Wednesday after President Joe Biden reassured investors by calling for vaccinations and testing but no travel curbs in response to the omicron coronavirus variant.
Tokyo, Hong Kong and Seoul advanced while Shanghai was down less than 0.1%.
The Shanghai Composite Index declined to 3,622.34 while the Nikkei 225 in Tokyo advanced less than 0.1% to 28,533.54. The Hang Seng in Hong Kong rose 0.8 per cent to 23,143.11.
The Kospi in Seoul added 0.2% to 2,980.69 while Sydney’s S&P-ASX 200 shed 0.2 per cent to 7,340.10.
New Zealand declined while Southeast Asian markets advanced.
Traders were rattled by official statements that omicron was spreading faster than expected after markets had bid up prices of airline, cruise line, oil and other travel-related stocks on expectations tighter controls could be avoided.
That takes place against a backdrop of expectations for tighter US monetary policy after the Federal Reserve indicated last week it will accelerate plans to wind down economic stimulus that has been boosting stock prices.