Having carefully assessed the possible impact of the Omicron coronavirus strain, investors found a positive sign for the global economy. In particular, optimism was prompted by a more careful study of the symptoms linked to the novel virus. Although the new strain is highly contagious, its symptoms turned out to be very mild. Following this news, markets breathed a sigh of relief. At the opening of the week, US stock index futures considerably recovered in Asia as traders reassessed risks associated with the Omicron variant amid new reports on moderate symptoms. The European market is likely to follow a similar dynamic. Bill Ackman, the founder of Pershing Square Capital Management, highlighted a possible benefit that Omicron may bring to the economy. According to the investor, “early reported data suggest that the Omicron virus causes ‘mild to moderate’ symptoms and is more transmissible. If this turns out to be true, this is bullish not bearish for markets.” The current situation can be explained with one popular wisdom: to get relief, make things worse first and then bring them back to normal. This is exactly what is happening to stock markets right now. Bracing for the worst, markets have priced in all the possible risks, but after realizing this was a false alarm, they came back to life with renewed vigour. The new coronavirus strain labeled B.1.1.529 was detected in South Africa on November 11, 2021. The first cases of infection were reported on November 24. The virus was named after the 15th letter of the Greek alphabet. The World Health Organization described Omicron as “a variant of concern.”
