Investors are clinging to hope as Omicron spreads, the stock rises

A trader works inside a floor stand on the New York Stock Exchange (NYSE) in New York City, USA, November 8, 2021. REUTERS / Brendan McDermid / File Photo

Sign up now for FREE unlimited access to reuters.com

  • US stock indices are closing higher
  • European stocks close higher
  • Gold lighter, raw futures company
  • 10-year US government interest rates rise
  • Graphics: Global asset performance

NEW YORK / LONDON, November 29 (Reuters) – A hint of calm returned to world markets on Monday as investors waited for more details to assess the severity of the Omicron coronavirus variant on the world economy, allowing battered stocks and oil prices to rise .

Global equities rose, oil prices rose, and safe-haven bonds lost ground as markets hoped the new variant would turn out milder than originally feared. Read more

The Dow Jones Industrial Average (.DJI) rose 236.6 points, or 0.68%, to 35,135.94; The S&P 500 (.SPX) rose 60.61 points, or 1.32%, to 4,655.23; and the Nasdaq Composite (.IXIC) added 291.18 points, or 1.88%, to 15,782.83.

Sign up now for FREE unlimited access to reuters.com

The pan-European STOXX 600 (.STOXX) ended with 0.7%, logging its best day in a month and regaining some of Friday’s 3.7% drop triggered by concerns about the newly discovered variant.

MSCI’s benchmark for stocks around the globe (.MIWD00000PUS) rose 0.67%.

News of the variant triggered alarm and a sale on Friday that wiped out about $ 2 trillion in the value of global stocks as countries imposed new restrictions for fear the variant could withstand vaccinations and offset an incipient economic reopening following a two-year global pandemic .

Omicron, discovered in South Africa last week, has been found as far as Canada and Australia. The World Health Organization said Monday that the highly mutated variant poses a very high risk of infection increases. Read more

Still, investors took comfort from signs that its impact may not be as severe as feared. In South Africa, a top expert in infectious diseases said existing COVID-19 vaccines are likely to be effective in preventing serious illness and hospitalization. Read more

“Right now, the market is responding positively to statements that this variant will not be a major issue, but there is still some concern,” said Tim Ghriskey, chief investment officer at Inverness Counsel in New York.

A South African doctor, who was one of the first to suspect a new strain, said on Sunday that patients so far appeared to have mild symptoms. Read more

“It was reported that the new strain of the virus is ‘unusual but mild’ and it appears to be the driving force behind the rise in equities today,” said David Madden, market analyst at Equiti Capital.

snapshot

MSCI’s broadest index of Asia-Pacific equities outside Japan (.MIAPJ0000PUS) fell 0.4%, but found support ahead of its lowest level in 2021. Japan’s blue-chip Nikkei (.N225) fell 1.6% as the country moved to prevent aliens to avoid the Omicron tribe.

Oil prices rose after falling more than 10% on Friday in their biggest one-day drop since April 2020.

Futures on U.S. crude oil fell to $ 69.95 per barrel, up 2.6%. Brent futures fell to $ 73.44 per barrel, up 1%.

Speculation that the oil-producing group OPEC and its ally, known as OPEC +, could pause production growth in response to the spread of Omicron, helped the oil price rise. Read more

Brent jumps

CHANGE EXPECTATIONS

The European Central Bank’s policy makers tried to reassure investors rattling off the new variant, arguing that the eurozone economy had learned to cope with the successive waves of the pandemic. Read more

This encouraged a pull out of the safe haven bond markets, which had risen on Friday as investors priced the risk of a slower start on US Federal Reserve rate hikes and minor austerity measures from some other central banks. Read more

Benchmark 10-year notes last fell 9/32 in price to a return of 1.5141%, from 1.485% late Friday day.

European government bond yields rose,, with the latest inflation figures highlighting the forthcoming challenges for the ECB.

German inflation is set to exceed the 5% threshold in November for the first time in almost three decades, regional data from several states suggested on Monday. Read more

Gold prices fell, resuming a broad drop from the previous week as the dollar strengthened and risk sentiment recovered.

US gold futures fell 0.2% to $ 1,782.30.

The dollar index rose 0.07%, with the euro falling 0.32% to $ 1.1281.

Sign up now for FREE unlimited access to reuters.com

Further reporting by Wayne Cole in Sydney; Graphics by Danilo Masoni and Sujata Rao; Editing Angus MacSwan and Richard Chang

Our standards: Thomson Reuters Trust Principles.

.

Give a Comment