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Author: Wayne Cole
SYDNEY (Reuters) – Asian markets regained some composure on Monday as investors settled with uncertainty for weeks that Omicron variants would really hinder economic recovery and plans to tighten plans for some central banks.
Oil prices also bounced back $ 3 a barrel to recover from Friday’s bombing of the barrel, and the safe haven yen took a breather after rising.
A new variant of the concern was found as far away as Canada and Australia, as more countries imposed a travel restriction to try to shut themselves down.
Britain called an urgent meeting of G7 health ministers on Monday to discuss developments in the virus, although a South African doctor who treated the cases said Omicron’s symptoms had so far been mild.
“We don’t know much about Omicron, but the markets have been forced to revise their global growth forecasts until they know more,” said Rodrigo Catril, a market strategist at NAB.
“ Pfizer (NYSE 🙂 expects to know in two weeks whether Omicron is resistant to the current vaccine, while others suggest it may last for weeks. Until then, the market is likely to remain nervous. ”
Trading was uneven at the beginning of Monday, but there were signs of stabilization as it rose 0.8% and the Nasdaq futures rose 0.9%.
Both indices suffered the biggest drop in months on Friday as travel and airline stocks hit hard.
The broader Asia-Pacific stock index fell by 0.1% outside the MSCI Japan, but was down from initial lows. Initial losses also fell by 0.9%.
The bonds returned some of the gains as the Treasury futures fell 11 ticks. The market rose sharply as investors threatened to start slowing rate increases on the US Federal Reserve and were not squeezed by some other central banks.
Two-year Treasury yields rose 0.55% after falling 14 basis points on Friday since March last year. The futures of Fed funds pushed the first rate hike for a month or more.
The change in expectations weakened the US dollar in favor of a safe haven for the Japanese yen and the Swiss franc.
At the beginning of Monday, the dollar stabilized at 113.81 yen, after falling 1.7% on Friday. It remained at 96,190 after a 0.7% drop on Friday.
The euro stood at $ 1.1294, following a rise of $ 1.1203 at the end of last week.
Christine Lagarde, president of the European Central Bank, put a bold face on the latest virus scare, saying the eurozone was better equipped to deal with the economic impact of a new wave of COVID-19 infection or the Omicron variant.
The economic newspaper is also busy this week with Chinese manufacturing PMIs on Tuesday to offer another update on the health of the Asian giant. A survey of US ISM factories came out on Wednesday, ahead of Friday’s payroll.
Fed Chairman Jerome Powell and Finance Secretary Janet Yellen speak to Congress Tuesday and Wednesday.
In commodity markets, oil prices rose on Friday after suffering the biggest one-day decline since April 2020. [O/R]
“The move guarantees that the OPEC + alliance will suspend the increase planned for January at its December 2 meeting,” the ANZ analyst wrote in a statement.
“Such headwinds are the reason why production has been rising steadily in recent months, despite increased demand.”
It bounced 3.9% to $ 75.57 a barrel, while it rose 4.5% to $ 71.24.
Gold has so far found little to no demand for a safe haven, and has remained at $ 1,791 an ounce.[GOL/]
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