Stock Futures Edge Higher After Christmas Holiday

Investors are braced for higher volatility over the holiday season. Concerns over the rapid spread of the Omicron variant of Covid-19 and the economic impact of measures countries may take to stem its spread have weighed on markets in recent weeks. Some investors expect that will be mitigated by vaccines and the rollout of booster shots in some nations. 

“Everything seems to be serious but manageable. Anything that changes that, this could probably make a big impact,” said

Luca Paolini,

chief strategist at Pictet Asset Management. 

Market moves can be amplified during the holiday season due to a lack of liquidity, or how readily buyers and sellers can find each other. With many traders off, prices people are willing to buy and sell at may be higher or lower because there are fewer counterparties. 

“We are in kind of this Christmas trading range, but low liquidity makes any potential shock bigger,” Mr. Paolini added. 

Shares of airline companies drifted lower in premarket trading. United Airlines Holdings declined 2.7% and American Airlines Group shed 2%. Flight cancellations marred Christmas weekend for many travelers, as Covid-19 left carriers short-staffed to operate busy schedules over the holiday.

In bond markets, the yield on the benchmark 10-year Treasury note ticked up to 1.496% from 1.492% Thursday. Yields and prices move inversely. 

Overseas, the pan-continental Stoxx Europe 600 edged up 0.3%. Markets in the U.K. were closed. 

In Asia, China’s Shanghai Composite closed almost 0.1% lower. South Korea’s Kospi and Japan’s Nikkei 225 each declined 0.4%. Markets in Hong Kong and Australia were closed. 

Write to Caitlin Ostroff at caitlin.ostroff@wsj.com