Stocks are set to start the week under pressure from investors watching US inflation data amid a sharp tilt from the Federal Reserve and Omicron’s impact as a risk-averse financial markets.
Asian futures pointed to open lower in the benchmark. US stocks extended weekly declines on Friday after volatility in a mixed US jobs report. Tesla Inc., Facebook parent Meta Platforms Inc. and Apple Inc. Technology companies underperformed, led by Heaven Assets such as Treasury and Gold.
The dollar was mixed in early Asian trade, while the yen took most of its gains. With bitcoin sinking, the cryptocurrency got swept away in a risk-off wave.
Chinese markets will be in focus after the country’s companies listed in the US fell on Friday amid increasing scrutiny of Chinese companies doing business in the US.
US consumer prices are expected to show the biggest annual increase in decades in November, putting pressure on the Fed to tighten policy sharply. Fed Chairman Jerome Powell has signaled a sharp reduction in asset purchases amid rising inflation. That assessment is unlikely to change after the smallest increase in US jobs this year.
“This week’s November CPI data could trigger the markets for prices – into a more aggressive tightening cycle -,” said Kim Mundy, a strategist at the Commonwealth Bank of Australia, in a note. “Uncertainty related to Omicron will remain, while market participants will wait to learn about the severity, contagiousness and resistance of the strain.”
Goldman Sachs Group Inc. cut its forecast for the US economy this year after Omicron was seen as a drag on growth.
Meanwhile, Anthony Fauci, chief medical adviser to US President Joe Biden, said on Sunday that there does not appear to be “a great degree of seriousness of O’Micron”, while it is too early to be certain. Moderna Inc. President Stephen Hoge said there is a “real risk” that existing vaccines will be less effective against Omicron.
Some of the main moves in the markets:
shares
- S&P 500 fell 0.8%
- Nasdaq 100 dropped 1.7%
- Nikkei 225 futures fell 1.2% earlier
- Australia’s S&P/ASX 200 Index futures rose 0.2% earlier
- Hang Seng Index futures fell 1.7% earlier
currencies
- The Japanese yen was at 112.84 per dollar
- offshore yuan 6.3748 per dollar. was on
- The Bloomberg Dollar Spot Index was little changed on Friday
- Euro $1.1318 . was on
bond
- Yield on 10-year Treasury fell 10 basis points to 1.34%
Goods
- West Texas Intermediate crude was at $66.26 a barrel on Friday
- Gold rose 0.8% to $1,783.29 an ounce
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