WASHINGTON (dpa-AFX) - U.S. stocks tumbled right at the start of the session on Monday, and stayed weak right through the day as rapidly spreading Omicron variant of the coronavirus raised concerns about global economic recovery.
The major averages all ended notably lower. The Dow, which plunged more than 700 points to 34,665.50, ended the day with a loss of 433.28 points or 1.23 percent at 34,932.16. The Nasdaq closed lower by 188.74 points or 1.24 percent at 14,980.94, recovering from the day's low of 14,860.04, while the S&P 500 settled at 4,568.02, recording a loss of 52.62 points or 1.14 percent.
With the World Health Organization saying the number of cases is doubling in 1.5 to 3 days in areas with community transmission, traders seem worried the new strain could derail the global economic recovery.
The spread of the Omicron variant could also lead to further global supply chain issues, which have contributed to elevated inflation.
Several countries, including France and Austria have tightened travel restrictions. Paris canceled its New Year's Eve firework celebration, while Germany, which has ruled out a Christmas lockdown, has warned a fifth wave could no longer be stopped.
Concerns about the deadlock over U.S. President Joe Biden's $1.75 trillion investment bill also weighed on sentiment. Sen. Joe Manchin, a conservative Democrat from West Virginia, said over the weekend that he won't support the Biden administration's 'Build Back Better' plan.
Energy stocks ended weak as crude oil prices fell sharply amid worries about the outlook for energy demand. Falling Treasury yields weighed on bank stocks.
Caterpillar, Nike, Honeywell International, American Express, Boeing, Intel, JP Morgan Chase, Walt Disney, Vis and Microsoft shed 1 to 3 percent.
On the economic front, the Conference Board's Leading Index rose 1.1 percent in November, after rising 0.9 percent a month earlier.
In overseas trading, Asian stocks ended mostly lower on Monday, as the Omicron variant of the coronavirus continued to spread around the world and expectations grew that the Federal Reserve will raise interest rates more aggressively next year.
European stocks closed notably lower amid fears of fresh disruptions across supply chains globally following tighter restrictions in Europe amid rapidly surging Omicron Covid-19 cases.
Several countries, including France and Austria have tighted travel restrictions. Paris has canceled its New Year's Eve firework celebration, while Germany, which has ruled out a Christmas lockdown, has warned a fifth wave could no longer be stopped.
Looking Ahead
Trading activity is likely to remain somewhat subdued during the rest of the shortened weak.
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