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Stocks and oil prices rise after Omicron and Powell’s remarks caused a downturn

Asian stocks rose and oil prices rebounded on Wednesday after a penalties session in which the economic implications of the Omicron coronavirus variant and hawkish comments from the chair of the Federal Reserve Board weighed heavily on the global market. ..

Most stock markets in Asia on Wednesday Previous session, Hong Kong’s Hang Seng Index is up 1.4% and Japan’s Topix is ​​up 0.7%.

The futures market tracking the STOXX 600 index in Europe rose 0.7% and the futures market tracking the Wall Street S & P 500 rose almost 1%. The FTSE 100 was expected to rise 0.6%.

Vaccine maker Moderna CEO after the market fell on Tuesday Financial Times We predict that existing jabs will be much less effective at treating omicrons than early strains of coronavirus.

The chairman of the Federal Reserve Board Jay Powell signaled He said he would support faster monetary tightening by the US central bank to combat rising inflation, despite the economic threat posed by the new variety.

The S & P 500 fell almost 2%, while the technology-focused Nasdaq fell 1.6%. Powell’s comments also pushed up yields on short-term government bonds that follow interest rate expectations and boosted long-term yields that track growth and inflation expectations. Yields are inversely proportional to bond prices.

Luca Paolini, chief strategist at Pictet Asset Management, said the advent of Omicron has helped asset managers make a profit after S & P and Stoxx set records earlier this month.

“We weren’t where we were in April 2020,” he said. “We now know more about this virus and society is ready to deal with it.” “This is some of the people who made a lot of money during the year. It was an excuse to fix profits. “

Analysts still warn that Omicron can be done Further disrupt world growthJust as many economies seemed to be recovering from the effects of the delta variant.

“The emergence of the Omicron variant of the coronavirus poses new risks to global economic growth and the outlook for inflation,” said Madha Bibokir, Senior Vice President of Credit Strategy and Research at Moody’s.

Bokir added that information about Omicron and policy reactions has not yet changed rating agencies’ growth forecasts. Travel restrictions “It could increase in the coming weeks,” as the government is trying to slow the spread of variants.

Crude oil prices have also recovered from the previous sharp drop. Brent crude, the international benchmark, rose 2.7% to $ 71.12 a barrel after falling almost 4% on Tuesday. West Texas Intermediate, a U.S. marker, rose 2.6% on the day to $ 67.91 as investors’ focus moved to the OPEC + meeting later this week to decide whether the group would stop plans to increase supply. became.

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Stocks and oil prices rise after Omicron and Powell’s remarks caused a downturn

Source link Stocks and oil prices rise after Omicron and Powell’s remarks caused a downturn

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