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The companies that stand to benefit the most from economic growth generated gains in the S&P 500, with small caps and travel stocks rising. The Dow Jones Industrial Average climbed nearly 2%, led by aerospace giant Boeing Co. Tech, which underperformed. The United States is moving forward in efforts to kick Chinese companies from stock exchanges for failing to meet disclosure requirements.
Volatility has gripped financial markets this week, stirred by the hawkish tone of Federal Reserve Chairman Jerome Powell and the spread of the omicron strain of coronavirus. The turmoil could offer investors a chance to position themselves for a trend reversal in reopening and commodity trading, according to strategists at JPMorgan Chase & Co. While the variant is likely to be more transferable, early reports suggest it may also be less fatal, they added.
“What we are seeing is the propensity to buy the downside,” said Aoifinn Devitt, chief investment officer at Moneta Group. “And why are we buying the dip?” Because there is so much money on the sidelines. While these short periods of volatility are surprising and have certainly cooled the markets, we still have a significant bank of stock returns that we can take advantage of since the start of the year.
Read: Citadel Securities, NYSE See ‘extreme events’ become routine
Read: Renewed employment strength in US faces new challenge at Omicron
U.S. state unemployment claims rose less than expected last week, suggesting further progress in the labor market. The figures came a day before the monthly jobs report, which is expected to show payrolls increased by 550,000 in November.
Fed Governor Randal Quarles, Atlanta Fed Chairman Raphael Bostic and his San Francisco counterpart Mary Daly have called for an acceleration in the removal of political support amid higher inflation – adding their voice to the message delivered by Powell this week. Treasury Secretary Janet Yellen said she understood the “reasoning” behind the central bank’s plans to reduce asset purchases.
Some other highlights of the company:
- Apple Inc. has told its component suppliers that demand for the iPhone 13 line has weakened, people familiar with the matter said.
- U.S. antitrust authorities have filed a lawsuit to block Nvidia Corp’s $ 40 billion buyout plan. of Arm Ltd., saying the deal would hurt competition in the semiconductor market.
- Exxon Mobil Corp. will give US workers lower-inflation pay increases in early 2022. The oil giant will raise wages by 3.6% on average for those who have shown “merit,” according to a company document consulted by Bloomberg.
- Grab Holdings Ltd., Southeast Asia’s largest rideshare and delivery company, sank on its first day of listing after its merger with Altimeter Growth Corp. completed, the biggest deal to date for a specialized acquisition company.
Oil prices are poised for gains, as Thursday’s OPEC + decision to make the planned production increases will not derail an ongoing structural bull market, analysts at Goldman Sachs Group Inc. say. The investment sees “very clear upside risks” in its forecast for Brent to average $ 85 per barrel in 2023.
Key events to follow this week:
For more market analysis, read our MLIV blog.
Some of the main movements in the markets:
- The S&P 500 rose 1.4% at 4 p.m. New York time
- The Nasdaq 100 rose 0.7%
- The Dow Jones Industrial Average rose 1.8%
- MSCI World Index up 0.7%
- Russell 2000 Index Up 2.7%
- The Bloomberg Dollar Spot Index changed little
- The euro fell 0.2% to $ 1.1300
- The British pound rose 0.2% to $ 1.3299
- The Japanese yen fell 0.3% to 113.17 per dollar
- The yield on 10-year Treasuries rose three basis points to 1.43%
- German 10-year yield fell three basis points to -0.37%
- UK 10-year yield fell 1 basis point to 0.81%
- West Texas Intermediate crude rose 2% to $ 66.90 a barrel
- Gold futures fell 0.8% to $ 1,769.30 an ounce
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