Wall Street closed higher on Wednesday completing back-to-back rallies after three-days of Omicron-led decline. Strong economic data and development on COVID-19 treatment front supersede market participants’ concerns on the rapid spread of the Omicron. All three major stock indexes ended in positive territory.

How Did The Benchmarks Perform?

The Dow Jones Industrial Average (DJI) surged 0.7% or 261.19 points to close at 35,753.89. Notably, 26 components of the 30-stock index ended in green while 4 in red. The tech-heavy Nasdaq Composite finished at 15,521.89, jumping 1.2% or 180.84 points due to strong performance by large-cap technology stocks.

Meanwhile, the S&P 500 climbed 1% to end at 4,696.56. All eleven sectors of the benchmark index closed in positive territory. The Technology Select Sector SPDR (XLK), the Health Care Select Sector SPR (XLV) and the Consumer Discretionary Select Sector SPDR (XLY) rallied 1.3%, 1.2% and 1.8%, respectively.

The fear-gauge CBOE Volatility Index (VIX) was down 11.3% to 18.63. A total of 8.6  billion shares were traded on Wednesday, lower than the last 20-session average of 11.8 billion. Advancers outnumbered decliners on the NYSE by a 3.17-to-1 ratio. On Nasdaq, a 1.65-to-1 ratio favored advancing issues.

No Lockdown on Omicron

The latest Omicron variant of the coronavirus is spreading rapidly across the world including the United States. So far, more than 90 countries have witnessed the Omicron variant of coronavirus and the number of cases is doubling in 1.5 to 3 days in areas with community transmission. In the United States 43 states have already reported the presence of Omicron.

However, on Dec 21, President Joe Biden said “absolutely no” to whether March 2020-style lockdowns will return to the United States as a result of the rapid spread of Omicron. His administration plans to get more booster shots, distribute 500 million free at-home COVID-19 testing kits and the immediate deployment of military doctors, nurses and other medical professionals to the six most-affected states.

In a major development in COVID-19 treatment front, on Dec 22, the FDA granted emergency authorization to Pfizer Inc.’s (PFE Quick QuotePFE - Free Report) COVID-19 treatment pill. The FDA recommended this oral treatment for those who are at a high risk of developing severe COVID-19. Pfizer’s pill is the first oral antiviral drug authorized by the FDA that is specifically designed to fight novel coronavirus. The pill, which has revolutionized the COVID-19 treatment method will be available from this weekend.

Notably, another COVID-19 treatment pill developed by Merck & Co. Inc. (MRK Quick QuoteMRK - Free Report) is awaiting FDA authorization. Following the news, shares of both Pfizer and Merch rose 1% and 0.8%, respectively. Both companies carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Economic Data

The Conference Board reported that Consumer Confidence in December came in at 115.8 surpassing the consensus estimate of 111. November’s reading was revised upward to 111.9 from the earlier reported 109.5. The sub-index for present situation (based on consumers’ assessment of current business and labor market conditions) dropped slightly to 144.1 in December to 144.4 in November. The sub-index for expectations (based on consumers’ short-term outlook for income, business, and labor market conditions) surged to 96.9 in December from 90.2 in November.

The Bureau of Economic Analysis has upwardly revised the third-quarter 2021 U.S. GDP growth rate to 2.3% from 2.1% in the second estimate. The consensus estimate was 2.1%.

The U.S. Energy Information Administration reported that U.S. commercial crude oil inventories decreased by 4.7 million barrels for the week ended Dec 17, from the previous week.

According to the National Association of Realtors, existing home sales in November came in at seasonally adjusted 6.46 million units, up 1.9% from October. The consensus estimate was 6.51 million units.