U.S. Stocks Open Flat as Dow Aims to Extend Its 5-day Winning Streak

U.S. stocks were little changed early Wednesday morning following a mixed session as traders continued to assess the threat of the omicron Covid-19 variant.

The Dow Jones Industrial Average traded near the flatline. The S&P 500 moved marginally higher and the Nasdaq Composite ticked up 0.2%.

The U.S. has confirmed more than 4.1 million Covid cases this month, according to data from Johns Hopkins University. That’s well above November’s tally of 2.54 million. The country’s seven-day average of cases is also at 231,888 cases, more than triple the mean from Nov. 27.

However, the Centers for Disease Control and Prevention this week shortened its isolation recommendation for people who test positive from 10 days to five if they don’t have symptoms. Research from South Africa also suggests that omicron infections can boost immunity against the delta variant.

Stocks were under pressure in late November, when news of the omicron variant first broke. They have since rebounded, however, with the S&P 500 up 4.8% for December.

The market has shown resiliency in the past few weeks as traders weigh the omicron variant and potentially tighter monetary policy from the Federal Reserve next year, Virtus Investment Partners’ Joe Terranova told CNBC’s “Closing Bell” on Monday.

He noted, though, that the “risk profile of the market is clearly changing” due to the potential for higher volatility in the new year.

The market is “gravitating toward a more qualitative holding,” Terranova said. “I don’t think the market wants the speculative areas in which investors have been rewarded the last couple of years. That’s the hyper-growth stocks.”

In the premarket Wednesday, Tesla shares rose after financial filings published late Tuesday showed CEO Elon Musk sold another 934,090 shares, or about $1.02 billion worth of his holdings, in the electric vehicle company.

During the regular trading session, the Dow notched its fifth straight day of gains, rising more than 90 points. The S&P 500 eked out an intraday record before closing lower on the day. The Nasdaq Composite lagged, falling 0.6%.

The “Santa Claus rally” period encompass the last five trading days of December and the first five of January. This is a historically strong period for the market, with the S&P 500 averaging a return of 1.7% since 1928.