Wall Street's main indexes eased in choppy trading on Friday, but headed for their best three year run since 1999, driven by massive stimulus, vaccine rollouts, and strong retail participation.

Ten of 11 major S&P sectors gained amid quiet trading, with energy — the best performing sector of 2021 — leading the charge higher.

Omicron Fears Ease

The S&P 500 and Dow hit peaks this week, as optimism from early data suggesting the omicron variant was less virulent than other strains outweighed worries from a record-high surge in U.S. cases and warnings of disruptions ahead.

On New Year's Eve, thousands of flights within the United States and internationally were delayed and hundreds were canceled, but investors took heart from South Africa announcing the Omicron wave had crested without a huge surge in deaths.

"The market is subdued. It is typical for the market to be down a little bit on the last day of the year," said Thomas Hayes, managing member at Great Hill Capital Llc in New York.

Aiding the broader upbeat sentiment was a string of positive data this week, including a report that showed no impact yet of the rampant jump in infections on the U.S. labor market, although market action has been choppy in thin holiday trading.

Eight of the 11 major S&P sector were lower amid quiet trading. Healthcare, real estate and consumer staples were higher.

At 10:41 a.m. ET, the Dow Jones Industrial Average was down 77.45 points, or 0.21%, at 36,320.63, the S&P 500 was down 8.17 points, or 0.17%, at 4,770.56, and the Nasdaq Composite was down 33.74 points, or 0.21%, at 15,707.83.

S&P 500 Up 27%

The benchmark S&P 500 is set to exit the year 27% higher, with energy sector's 47.4% jump outperforming all other sector indexes. Real estate and technology sectors, up 44% and 34% respectively over the past year, were the next best performers.

The blue-chip Dow is set to rise 19%, while the tech-laden Nasdaq is on pace to climb 22%.

As investors prepare to ring in the New Year, fourth-quarter earnings, the pace of monetary policy tightening, and midterm elections in the U.S. Congress will be key in determining the path forward for stock markets.

"This 3%-5% pullback of this year will turn into 8%-10% mini corrections in 2022 as the market starts to sniff out liquidity withdrawals," Hayes added.

Among other individual companies, Xeris Biopharma Holdings Inc jumped 19.3% after the company's drug Recorlev received an approval for treating adult patients with Cushing's syndrome, a rare hormonal disorder.

18 Record Highs for the S&P 500, 25 for Nasdaq

Tesla Inc is recalling more than 475,000 of its Model 3 and Model S electric cars to address rearview camera and trunk issues that increase the risk of crashing. It shares however, edged marginally lower.

Advancing issues outnumbered decliners by a 1.08-to-1 ratio on the NYSE and advancing issues outnumbered decliners by a 1.08-to-1 ratio on the Nasdaq.

The S&P index recorded 18 new 52-week highs and no new low, while the Nasdaq recorded 25 new highs and 49 new lows.