by Laetitia Volga
PARIS (Reuters) – The main European stock markets are expected to drop sharply on Monday at the opening, concern over the rapid spread of the Omicron variant of the coronavirus and the health restrictions put in place to weigh on the trend within a few days of the Christmas holidays. end of year.
According to the first indications available, the Parisian CAC 40 could lose 2% at the opening, the Dax in Frankfurt would fall by 1.96% and the FTSE in London by 1.52%.
“Omicron is poised to be the Grinch that stung Christmas in Europe,” said Tapas Strickland, director of economics at NAB. “With COVID-19 cases due to Omicron doubling every 1.5 to 3 days according to the World Health Organization, the risk of hospital systems being overwhelmed, even with effective vaccines, remains,” he said. he added.
Faced with Omicron’s advance, the Netherlands entered new containment on Sunday, at least until January 14, the British government announced not to exclude new restrictions for Christmas and the Italian government would consider tightening its measures according to the press.
Investors’ caution can also be explained by the still high level of inflation and by the more restrictive guidelines taken by several large central banks, including the Federal Reserve.
Still in the United States, Democratic Senator Joe Manchin, whose vote is crucial for the adoption of Joe Biden’s vast plan of social reforms, announced Sunday to everyone’s surprise that he would not support the project. ‘he considers too expensive.
A WALL STREET
On Friday, the New York Stock Exchange finished in the red, the financial and energy sectors in the lead, as investors worried about the development of the pandemic and the monetary tightening looming in the United States. [.NFR]
The Dow Jones index lost 1.48% to 35,365.44 points, the S & P-500 1.03% to 4,620.64 points and the Nasdaq Composite 0.07% to 15,169.68 points.
Over the week, the S&P 500 lost 1.9%, the Dow Jones 1.7% and the Nasdaq 2.9%.
Wall Street futures show an opening down 1% to 1.2% on Monday.
IN ASIA
Concern over the spread of the Omicron variant weighs on Asian markets: the Nikkei index in Japan has lost 2.13%, at its lowest in two weeks, and in China, the CSI 300 is down 1.43%.
The People’s Bank of China decision on Monday to lower its one-year prime lending rate by five basis points is unlikely to have a big impact on the economy, analysts say.
RATE
A sign of the averson to risk, the yield on ten-year Treasuries is down nearly three basis points to 1.3665%.
CHANGES
The dollar is in equilibrium against other major currencies, now nearing a one-and-a-half-year peak as the US Fed moves towards tightening monetary policy.
Governor Chris Waller said on Friday that a rate hike in March was “very likely” and that the central bank could start shrinking its balance sheet in mid-2022. For her part, Mary Daly, president of the San Francisco Fed, did not rule out a rate hike as early as next March and declared herself in favor of two or three rate hikes in 2022.
The euro is trading around $ 1.1251, up 0.11%.
OIL
The oil market is dropping sharply as rising COVID-19 cases in Europe and the United States fuel concerns among investors, who fear the new restrictions will affect demand for crude.
The barrel of Brent lost 3.35% to 71.06 dollars and US light crude 3.71% to 68.23 dollars.
(Laetitia Volga, edited by Blandine Hénault)
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