Shares mixed according to Wall Street Record

Equities have been affected by the spread of the Omicron variant in recent weeks as governments around the world have imposed restrictions on trying to curb infections. However, some recent studies have suggested that the variant may result in milder disease with a lower risk of hospitalization.

The Centers for Disease Control and Prevention reduced the recommended isolation period for some people who test positive to try to minimize disruption. Nevertheless, many economists have lowered their forecasts for economic growth in the first quarter of next year.

“What comes from markets is the belief that Omicron will not be able to disrupt the economic recovery,”[ads1]; said Antonio Cavarero, chief investment officer at Generali Insurance Asset Management. “There is no visible risk reduction.” This is partly due to lower liquidity from fewer people working around the holidays, he said.

Equity investors are watching a phenomenon known as the “Santa Claus Rally.” Indices such as the S&P 500 tend to rise in the last five days of the year and the first two days of the new year. Such a rally takes place at the end of about four out of every five years, according to the Stock Trader’s Almanac.

“It’s happening because people are starting to position themselves. People are reading everyone’s 2022 estimates and planning for next year,” said Jeffrey Meyers, a hedge fund and family law firm at Market Securities.

Governments and political advisers are showing signs of easing policy on the rapidly spreading Omicron variant, reducing quarantine periods and in some cases refraining from restrictions on social distancing when trying to keep economies moving. Vaccine manufacturers were mixed, with Novavax increasing 4.4% and Moderna down 0.6%.

These news have also helped shares in travel and energy companies, with Carnival rising 1.6% and Valero Energy up 0.9%.

Cutting quarantine times is positive for investors and makes market participants look past the Omicron rise, said David Kotok, chief investment officer at Cumberland Advisors. But it also risks allowing the Covid-19 virus to mutate, spread and disrupt economies, he added. He is overweight health care stocks.

“This is not over, and the markets want to celebrate that it is over. But the virus does not care if the markets want,” Kotok said.

Oil prices rose, with the global benchmark Brent oil rising 0.45% to $ 78.57 a barrel.

The yield on the benchmark index for 10-year government bonds ticked down to 1.466% from 1.480% on Monday, and fell for the third day in a row. Shorter bond yields rose, and the two-year yield reached 0.754%.

The S&P CoreLogic Case-Shiller National Home Price Index, which measures average house prices in large metropolitan areas across the country, showed that house price growth in the United States slowed in October. Shares for homebuilders rose during Tuesday’s session, with DR Horton up 0.6% and Taylor Morrison up 0.88%.

The earnings season has largely ended. Among the few who still report is the egg producer Cal-Maine Foods, which is expected to post results on Tuesday after the markets close.

Bitcoin fell around 5.4% from the level at 17:00 ET on Monday, trading around $ 48,224. The cryptocurrency has fluctuated around $ 50,000 in the last five days.

Abroad, the pan-continental Stoxx Europe 600 increased 0.6%.

The Turkish lira rose 1.4% to 11.9 against the dollar. The currency had strengthened after the government announced a new economic plan last week. President Recep Tayyip Erdogan “may have bought Turkey for a while, but it’s still not a big deal,” Meyers said. Speculative investors are likely to close short positions ahead of the long holiday weekend and can now put them back on, weighing down the lira, he said.

In Asia, most major benchmarks rose. The Shanghai Composite Index rose 0.4% and Hong Kong’s Hang Seng Index rose 0.2%. Japan’s Nikkei 225 rose 1.4%, led by a rise in technology stocks.

Shares in China Evergrande Group rose early, rising 3.8%. The heavily indebted property developer said that construction work had resumed on more than 90% of the stopped housing projects. It also said that they delivered apartments faster to home buyers.

Write to Anna Hirtenstein at anna.hirtenstein@wsj.com