Salem Radio Network News Tuesday, January 18, 2022

Business

Stocks up, oil eases as investors digest post-Christmas Omicron hangover

By Danilo Masoni and Katanga Johnson

WASHINGTON (Reuters) -Global equity markets stocks rose and oil prices eased on Monday as flight cancellations over Christmas revived concerns that the Omicron coronavirus variant could slow the economy into 2022.

U.S. airlines have cancelled or delayed thousands of flights due to staff shortages, while several cruise ships had to cancel stops after COVID-19 outbreaks aboard.

In Asia, China reported its highest daily rise in local COVID-19 cases in 21 months as infections more than doubled in the northwestern city of Xian, its latest hotspot.

France hit another infection record on Friday, prompting the government to convene a special meeting on Monday which could trigger new restrictions on movement.

A gauge of stocks across the globe rose 0.35% as European gains were offset by earlier weakness across Asian markets, although some investors were confident a global recovery would regain steam next year.

Gold prices slipped in thin trade on Monday as the U.S. dollar rebounded, though bullion was still hovering close to a one-week high as concerns over the Omicron coronavirus variant increased safe-haven demand.

Spot gold was down 0.2% at $1,804.49 an ounce by 1326 GMT but remained above the $1,800 reached last week. U.S. gold futures slipped 0.3% to $1,806.50.

Megacap companies helped U.S. stock indexes higher, while airlines and travel stocks fell pre-market.

“Heading into 2022 we will still have COVID uncertainties but the good news is that, according to the WHO, we may be see the end of the pandemic towards the end of year,” said Jawaid Afsar, sales trader at Securequity.

He added that next year markets would also have to contend with other issues, ranging from inflationary pressures to policy tightening and geopolitical risks.

Looking ahead, thinner-than-usual trading volumes ahead of New Year could make markets susceptible to volatile moves, although the last five trading days of December and the first two days of January have boded well for U.S. stocks 75% of the time since 1945, according to CFRA Research data.

The pan-European STOXX 600 index rose 0.49% at its highest level in over a month, helped by gains in defensive sectors, while Japan’s Nikkei ended 0.4% lower.

Mainland Chinese shares weakened, with Shanghai’s benchmark sliding 0.4% and an index of blue chips retreating less than 0.1%. That was despite property stocks getting a lift after China’s central bank vowed to promote healthy development of the real estate market.

Australia, Hong Kong and Britain were among the markets closed on Monday for holidays.

DOLLAR RANGEBOUND

On Wall Street, the Dow Jones Industrial Average rose 0.44% while the S&P 500 gained 0.61%.

The Nasdaq Composite added 0.6%.

The gains followed record levels at Thursday’s close amid signs that Omicron may cause a milder level of illness, even as the highly transmissible variant led to a surge in case numbers.

In debt markets, U.S. Treasuries 10-year yields held below Thursday’s high of just above 1.5%. Germany’s 10-year yield, the benchmark for the euro zone, hit a one-month high at -0.222% and was last up 1 basis point on the day.

In the foreign exchange markets, the dollar was rangebound, despite a hawkish turn at the Federal Reserve this month that saw policymakers signal three quarter-point rate hikes in 2022.

The dollar index, which measures the currency against six major peers, fell 0.014%, with the euro up 0.09%.

In the crude market, U.S. West Texas Intermediate futures recently fell 0.09% to $73.72 per barrel and Brent was at $76.85, up 0.93% on the day.

Spot gold added 0.1% to $1,810.45 an ounce.

(Reporting by Katanga Johnson in Washington, Danilo Masoni in Milan and Kevin Buckland in Tokyo; Editing by Pravin Char and Alexander Smith)

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