Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Omicron Variant, Black Friday News, Gazprom Record - What's Moving Markets

EconomyNov 29, 2021 13:32
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters

By Geoffrey Smith -- World markets recover a bit of poise after Friday's rout. Global health authorities warn that the new 'Omicron' variant of Covid-19 is potentially a high-risk development, but there is no evidence yet of it being more deadly than Delta. European gas prices continue to surge, as Gazprom (MCX:GAZP) reports record profits, and oil prices bounce on speculation that OPEC and its allies will pause their program of incremental output increases. Here's what you need to know in financial markets on Monday, 29th November.

1. Global markets retrace Omicron rout

Global markets recovered some – but by no means all – of their Friday losses as governments and health officials around the world stepped up their reaction to the discovery of the new Covid-19 variant, known as Omicron.

The dollar index, which tracks the greenback against a basket of developed market economies, stabilized after the initial shock of the news led traders to reprice the risk of interest rate hikes next year. By 6:35 AM ET (1135 GMT), it was up 0.1% at 96.165, still firmly within the upward trend that dates back to June. The yield on interest rate-sensitive two-year Treasury bonds was at 0.54%, up two basis points on the day but still down some 14 basis points from last week’s high.

European equity indices recovered about one-third of what they had lost on Friday, while emerging market currencies, oil and base metals also enjoyed recoveries of varying strength overnight.

2. WHO warns on Omicron but the verdict is far from clear

The Omicron variant was designated by the World Health Organization on Friday as a ‘variant of concern’, but the UN body stressed that there remains ‘substantial uncertainty’ over the dangers it poses. That uncertainty extends to how effective the current generation of vaccines will prove against it. Moderna (NASDAQ:MRNA) CEO Stephane Bancel and Pfizer (NYSE:PFE) CEO Albert Bourla have both expressed confidence that their vaccines can be adapted to fight the new variant within a couple of months.

Preliminary research findings in South Africa, where it was first identified, suggest it is sufficiently transmissible to ‘crowd out’ the Delta variant that has dominated this year’s waves of infection around the world. However, South African researchers have also said that it tended to trigger only mild infection (something that may not hold for the older populations of the northern hemisphere).

Various countries including the U.S. have now closed their borders to arrivals from South Africa and a handful of neighboring states. Japan and Israel have banned all foreign arrivals. However, there is already evidence of the variant as far afield as Canada, Australia and Europe.

3. Stocks set to open higher; retail and travel sectors in focus

U.S. stocks are set to follow the global pattern of a partial retracement when they open later, recouping around 1% after falling over 2% in a holiday-thinned Friday session.

By 6:20 AM ET, Dow Jones futures were up 251 points, or 0.7%, while S&P 500 futures were up 0.9% and Nasdaq 100 futures were up 1.2%.

Retail stocks are likely to be in focus later, against a backdrop of anecdotal reports suggesting that Black Friday sales volumes in physical stores were still more than 25% down from the level of 2019, suggesting that the shift to online that was accelerated by the pandemic is not being wholly reversed as mobility restrictions ease.

Also of interest will be the travel and hospitality sectors, which suffered badly on Friday from the news about the Omicron variant.

4. Europe freezes as its prices boil over

Everyone loves an underdog. However, the big winner from this year isn’t going to warm anyone’s hearts. Russian gas monopoly Gazprom (OTC:OGZRY) said earlier it has already earned more in profit in the first nine months than in any previous year, thanks to its tactic of restricting exports to Europe beyond the minimum levels required by its contracts.

Gazprom’s realized export prices have more than tripled this year to over $300 per 1,000 cubic meters. It published its numbers just as temperatures across north-west Europe plummeted due to an Arctic weather front. Withdrawals from European storage facilities consequently accelerated, increasing the risk of real shortages, rationing and economic contraction later in the winter.

That will also pose a risk to European inflation levels. ECB board member Isabel Schnabel said earlier the ECB expects annual inflation to have peaked in November. Spain’s inflation rate hit 5.6% this month and preliminary German data are due later in the session.

5. Oil recovers on OPEC+ output speculation

Crude oil prices rose over 5%, rebounding after sliding as much as $10 a barrel on Friday due to Omicron concerns. The rebound was helped by speculation that OPEC and Russia will decide not to raise output in January, reflecting the new outlook for fuel demand and the decision by the U.S. and other major importers to release strategic reserves in the coming months.

By 6:30 AM ET, U.S. crude futures were up 5.0% at $71.58 a barrel, while Brent futures were up 4.7% at $74.97 a barrel.

The Commodity Futures Trading Commission’s data on net speculative positioning will be released later in the day, having been pushed back from Friday due to the Thanksgiving holiday.

Omicron Variant, Black Friday News, Gazprom Record - What's Moving Markets

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email