The authorities apparently skipped a couple of letters in the Greek alphabet to get to omicron for the name of the covid strain that’s recently surfaced in South Africa–and is quickly spreading to the rest of the world. Apparently nu wasn’t aesthetically pleasing and xi is also a common name.

It’s not so surprising that on a sleepy day on Wall Street, when most portfolio heads were at home recovering from too much turkey on Thanksgiving, the negative reaction to the possible threat of omicron–speed of transmission + possible resistance to current vaccines–was as large as it turned out to be.

Today, the new news is that omicron symptoms appear to be relatively mild. So markets, in pre-open trading at least, are reversing their Friday swoon.

I think there’s potentially very useful information in last Friday’s trading, especially if coupled with what happens today.

Friday was all about vaccine-makers and stay-at-home stocks. Peloton and Zoom are prime examples of the latter, each up by almost 6% on Friday–and both relatively weak in the pre-market. This pattern makes it easy to compile a list of stocks one might want to own if the world shuts down again, but probably not otherwise.

On the other hand, stocks that declined less than the market on Friday and also outperform today probably deserve a look if they’re not among one’s holdings now.

The converse of that are stocks where the bottom fell out on Friday. These are mostly travel, restaurant and entertainment names, I think. It will be interesting to see how these recover today. My only direct exposure to this area is through DIN, which I regard as a sort of reverse canary in the coal mine. My guess is that any bounce back will be tepid, at best. But let’s see what Mr. Market has to say.

At the very onset of covid early last year, I heard a public health expert speak on Bloomberg. His basic message was the medial consensus: that covid would continue to thrive and mutate into new threats until the whole world is vaccinated. The biggest challenge/threat would be in less developed countries, where the combination of poverty and lack of medical infrastructure (even things like refrigeration) would provide a fertile breeding ground for new variants. What the speaker could not have imagined–or at least was unwilling to put into words–is the political strategy of pandemic/vaccination denial that has emerged in the developed world, spurred on by the Republican party in the US. This is a human tragedy but probably means continuing trading opportunities in covid-related stocks.

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