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By Marc Jones
LONDON (Reuters) – World stocks traded higher on 2022 on Monday, the third year in a row of double-digit gains, and the dollar, oil prices and yields on benchmark government bonds boosted initial moves.
London traders were enjoying the last days of the holiday, but continental Europe got off to a strong start, with the index breaking a record high as a result of encouraging data from the eurozone and Eastern Europe.
The Eurozone Manufacturing Managers ’Purchasing Managers’ Index (PMI) fell to 58.0 in December from 58.4 in November, but matched the initial “flash” estimate even though coronary virus infection had risen recently, and was still comfortable with 50 marks separating growth from contraction.
“We’re seeing a temporary but very welcome sign that the supply chain crisis that has hit production lines across Europe is starting to reverse,” said Joe Hayes, a senior economist at IHS Markit, which includes the PMI survey.
The data also saw a rise in corporate purchasing stocks in the December record of the survey. This means that the input price index fell to an eight-month low, although it remains relatively high, allowing the factory to raise prices at a much slower pace.
“Relieving inflation rates is a welcome sign again, but we are still in warm territory,” Hayes added.
German, French, Italian and Spanish stock markets rose by 0.8% and 1.1%, while German 10-year bond yields – a benchmark for European borrowing costs – rose 4 points to their highest level since November. [/FRX]
Shares of eurozone banking rose 1.2%, while automakers rose 1.8% after Tesla (NASDAQ 🙂 and Hyundai set higher targets for this year.
LIRA
In currency markets, eurozone data did not lift the euro, as attention was drawn to how much the dollar could rise if the Federal Reserve raises US interest rates several times this year, as expected today.
It was a rough start to the year, with a 5% dip before a partial recovery, with its central bank reporting more than $ 3 billion in its reserves last month as it fell to record currency lows.
The Turkish statistics agency also reported that annual inflation rose much more than expected to 36% year-on-year in December, the highest since September 2002.
“This reflects the crazy wheel of inflation to attract demand, it is very dangerous because the central bank implied that price pressure was due to supply cuts, and that it could do nothing about it,” said Ozlem Derici Sengul, founding partner. Spinn Consulting Istanbul.
Commodity markets quickly returned to the swing of things, most of them after a horrible last 18-20 months.
Oil rose $ 79 a barrel on Monday, driven by tight supply and hopes of boosting demand in 2022, in part because the Omicron coronavirus variant is unlikely to close the global economy again. [O/R]
OPEC and its allies, known as OPEC +, are expected to hold a plan to increase production at a meeting on Tuesday.
, up 50% from last year and up 80% from COVID’s low impact in 2020, up $ 78 cents or $ 78.86 a barrel from 1.3%. US West Texas Intermediate (WTI) crude rose $ 1.03 or 1.4% to $ 76.24.
“Infection rates are rising worldwide, restrictions are being imposed in several countries, the air travel sector, among others, is suffering, but investor optimism is evident,” said PVM oil broker Tamas Varga.
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