Life in our pandemic-dominated world increasingly feels like one of those scary TV series where just when you think the monster has been vanquished, you realize it’s still alive. Today’s big market sell-off on news of the new Covid-19 variant in South Africa—dubbed Omicron by the World Health Organization—is a good reminder of how vulnerable the market is to another flareup of the virus. Combine that with the ever-present anxieties about inflation, and investors really can’t be too confident of anything right now.
One of the only (slightly) amusing elements of Wall Street’s reaction today was how quickly investors were to bid up some of the stocks of companies that benefited from the pandemic lockdowns—notably Zoom Video, Peloton, DoorDash, Roku and Netflix. This wasn’t a uniform reaction, mind you. Shares of Amazon, whose e-commerce business exploded during the lockdowns, fell a little over 2% today, about as much as the broader market. But investors showed last year that they didn’t see Amazon benefiting from the pandemic as much as smaller, more narrowly focused companies like Zoom and Peloton did. Amazon rose 76% in 2020 while Zoom rose 395%.