From Wall Street to Silicon Valley, these are the top stories that moved markets and had investors, business leaders, and entrepreneurs talking this week on Cheddar.
Another wave means another downturn as economists adjust their forecasts for GDP growth in 2022 over growing concerns that the omicron variant will be a drag on the recovery. Already over the holiday weekend, airlines canceled thousands of flights, and hospitals are feeling the strain as daily case counts hit record highs. The latest wave is expected to curb growth in the first quarter of 2022 and shift widely anticipated gains later into the year. Some economists have pointed out, however, that this wave is expected to cause less economic damage than prior ones, including the delta variant, with longer-term predictions currently a mixed bag.
SANTA CLAUS RALLY
Despite emerging omicron woes, the stock market pulled off a so-called "Santa Claus rally" this week, as stocks rose steadily from their December 20 low. The last week of the year often brings a slight rally, so markets aren't necessarily banking on continued gains. While the Dow and S&P 500 finished at all-time highs on Wednesday, analysts expect the rally to fade going into the new year, especially as the latest wave takes its toll on industries such as airlines and cruise ships. While markets were up big for 2021, they nonetheless saw slight losses on the last, thinly-traded day of the year.
CRUISE STOCKS DIVE
One sector that is taking omicron on the chin is the embattled cruise industry. After a disastrous 2020, the industry held up relatively well through 2021 and into December. That changed as familiar reports of outbreaks on cruise ships returned this week, and the CDC announced that even vaccinated people should stay away. Shares of Carnival, Royal Caribbean, and Norwegian were down 1 to 2 percent on Friday.
Meanwhile, in the skies, shares of JetBlue Airways whipsawed this week amid uncertainty around omicron and new CDC guidelines on quarantining. The stock was up 7.5 percent earlier in the week, even as the airline industry canceled thousands of flights. The company announced that it plans to cancel flights through mid-January due to crew shortages, and shares eventually slid along with other airline stocks. However, JetBlue shares finished the week just slightly down as it leads the pack in laying out plans for 2022.
Chinese ride-hailing company Didi Global saw its shares tumble on Monday after a report from the Financial Times that current and former employees were banned from selling their stock, even as the company's 180-day, post-IPO lock-up period ended. The stock dropped more than 8 percent on the week. The scandal comes as Didi moves forward with plans to delist from U.S. exchanges amid a broader regulatory crackdown in both the U.S. and China.