The US markets ended lower on Tuesday on renewed concerns about the new coronavirus variant after Moderna's (MRNA) CEO said Covid-19 vaccines are likely to be less effective against Omicron. Moderna CEO Stephane Bancel said that it would take a couple of weeks to determine how much the mutations have affected the efficacy of the vaccines currently available in the market. Regeneron Pharmaceuticals (REGN) has also warned its Covid-19 antibody cocktail and similar drugs could be less effective against the Omicron variant.
Markets saw further downside after Federal Reserve Jerome Powell suggested during Congressional testimony that the central bank would discuss accelerating the pace at which it reduces its asset purchases during the next monetary policy meeting. Powell said ‘At this point, the economy is very strong and inflationary pressures are higher, and it is therefore appropriate in my view to consider wrapping up the taper of our asset purchases … perhaps a few months sooner’. In early November, the Fed announced plans to begin reducing its $120 billion in monthly bond purchases by $15 billion per month.
Dow Jones Industrial Average fell 652.22 points or 1.86 percent to 34,483.72, Nasdaq dropped 245.14 points or 1.55 percent to 15,537.69 and S&P 500 was down by 88.27 points or 1.9 percent to 4,567.
