US equity futures, oil regains ground after Omicron hits – .

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US equity futures, oil regains ground after Omicron hits – .


  • Asian Stock Markets:
  • U.S. Equity Futures Rise, Bonds Give Up Some Gains
  • Nikkei down, but above the first lows
  • Omicron spreads, may take two weeks to learn more
  • Oil rebounds after sharp drop

SYDNEY, Nov. 29 (Reuters) – Asian markets regained some composure on Monday as investors settled for a few weeks of uncertainty as to whether the Omicron variant would really derail the economic recovery and plans for tightening of some central banks.

Oil prices also rebounded $ 3 a barrel to recoup some of Friday’s bombing, while the safe haven yen paused after rising.

The worrying new variant has been found as far away as Canada and Australia as more countries have imposed travel restrictions in an attempt to shut down. Read more

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Britain called an urgent meeting of G7 health ministers on Monday to discuss the evolution of the virus, although a South African doctor who had treated cases said Omicron’s symptoms were up to now benign.

“We don’t know a lot about Omicron, but the markets have been forced to reassess the prospects for global growth until we know more,” said Rodrigo Catril, market strategist at NAB.

“Pfizer expects to know within two weeks whether Omicron is resistant to its current vaccine, others suggest it could take several weeks. Until then, the markets should remain nervous. “

Trading was erratic early Monday, but there were signs of stabilization, with S&P 500 futures up 0.8% and Nasdaq futures up 0.9%.

Both indices suffered their biggest drop in months on Friday, with travel and airline stocks particularly hard hit.

The largest MSCI index of Asia-Pacific ex-Japan equities (.MIAPJ0000PUS) fell 0.1% but did not hit its first lows. Likewise, the Nikkei of Japan (.N225) reduced its first losses by 0.9%.

Bonds gave up some of their gains as Treasury futures fell 11 ticks. The market had recovered strongly as investors took into account the risk of a slower start to rate hikes from the US Federal Reserve and less tightening from other central banks.

Two-year Treasury yields climbed to 0.55%, after falling 14 basis points on Friday in the largest drop since March of last year. Fed funds futures had pushed back the first rate hike for about a month.

The shift in expectations undermined the US dollar, in favor of safe havens of the Japanese yen and the Swiss franc.

Early Monday, the dollar had stabilized somewhat at 113.81 yen, after slipping 1.7% on Friday. The dollar index held at 96.190, after falling 0.7% on Friday.

The euro stopped at $ 1.1294, after rebounding from $ 1.1203 late last week.

European Central Bank President Christine Lagarde has shown courage in the face of the latest virus alert, saying the euro area is better equipped to deal with the economic impact of a new wave of COVID infections -19 or the Omicron variant. Read more

The economic agenda is also loaded this week with Chinese manufacturing PMIs on Tuesday to offer another update on the health of the Asian giant. The US ISM factory survey was released on Wednesday, ahead of Friday’s wages.

Fed Chairman Jerome Powell and Treasury Secretary Janet Yellen speak to Congress Tuesday and Wednesday.

In commodities markets, oil prices rebounded after suffering their biggest one-day drop since April 2020 on Friday.

“This move virtually guarantees that the OPEC + alliance will suspend its planned January increase at its December 2 meeting,” an ANZ analyst wrote in a note.

“These headwinds are the reason why it has only increased production gradually in recent months, despite a strong rebound in demand. “

Brent rebounded 3.9% to $ 75.57 a barrel, while US crude rose 4.5% to $ 71.24.

Gold has so far found little safe-haven demand, leaving it stuck at $ 1,791 an ounce.

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Reporting by Wayne Cole; Editing by Richard Pullin and Shri Navaratnam

Our Standards: Thomson Reuters Trust Principles.

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