The US indices beat price records despite record daily number of COVID-19 diseases in the United States

At the end of yesterday's trading session, major US indices closed in small declines. The Dow Jones index (US30) decreased by 0.25%, the S&P 500 (US500) lost 0.30%, and the Nasdaq (US100) decreased by 0.16%. But despite the slight decline, the Dow Jones (US30) and the S&P 500 (US500) made new highs on Thursday on the back of the positive labor market statistics. The number of new jobless claims in the USA amounted to 198,000, while analysts expected the figure of 206,000. This is the lowest value since the pandemic began, and this data gave optimism to investors that a new wave of infections will not be able to stop the economic recovery.

But investor fears about further economic consequences from the Omicron strains remain. Yesterday, there were 484,377 new cases of the coronavirus in the US; it's a new world record.

Micron warned of dram-chip delays due to the Xi'an lockdown in China. Strict restrictions in China, which went into effect earlier this month, led to a reduction in the number of personnel in production. The risk of new supply chain problems is increasing.

Tesla recalled more than 475,000 electric cars in the United States because of technical defects that could increase the risk of accidents. According to Bloomberg, Tesla plans to recall all Model 3 cars produced between 2017 and 2020.

Yesterday, the US pharmaceutical company Jonson & Johnson reported that their booster vaccine reduced Omicron-related hospitalizations.

Europe's major stock indices did not have a unified dynamic yesterday. France's CAC 40 (FR40) increased by 0.16% despite the introduction of mandatory masks on the streets in Paris. Germany's DAX (DE30) added 0.21%, while Britain's FTSE 100 (UK100) decreased by 0.24%. COVID-19 continues to rise in the UK. The British rail operator was forced to suspend all departures to London Station until January 10. If the situation continues in such a way, Britain runs the risk of a partial economic shutdown, which will undoubtedly affect the economic performance of the fourth quarter.

Italy, Germany, and Spain have a bank holiday today. Markets will only be open in London and Paris but will close earlier in the run-up of the New Year.

Oil prices returned to growth on Thursday. The growth trigger is 3 main factors. The first is that a decline in inventories has been seen for the 3rd week in a row. Second, concerns about oil demand due to the Omicron strain are easing. Third, China cut oil import quotas for independent refiners.

The price of natural gas in Europe dropped to nearly $1,000 per 1,000 cu m amid falling natural gas futures and warming temperatures. On Wednesday, Gazprom CEO Alexei Miller said that filling the second string of Nord Stream 2 with technical gas was complete and that the pipeline was ready to operate.

Stock markets in Asia were trading Thursday without a single trend. Japan's Nikkei 225 Index (JP225) decreased by 0.4% by the close of trading, Hong Kong's Hang Seng (HK50) added 0.11%, and Australia's ASX 200 (AU200) increased by 0.05%.

Retail sales in South Korea rose to 4.6% in annual terms in November 2021. Meanwhile, inflation in South Korea has held above 3% for the third month in a row as high commodity prices, persistent supply problems, and strong domestic demand contribute to rising consumer prices. Consumer prices increased to 3.7% in annual terms, well above the Bank of Korea's target of 2%.

The National Bureau of Statistics of China released fresh statistics on business activity. China Manufacturing PMI increased to 50.3 from 50.1. China Services PMI rose to 52.7 from 52.3. The data were above analysts' consensus estimates. China will now shift its focus more on stabilizing its economy than active growth. However, the real estate market is still struggling, and there is also a high risk of new supply chain problems due to blockages in industrial areas.

Main market quotes:

S&P 500 (F) (US500) 4,778.73 −14.33 (−0.30%)

Dow Jones (US30) 36,398.08 −90.55 (−0.25%)

DAX (DE40) 15,884.86 +32.61 (+0.21%)

FTSE 100 (UK100) 7,403.01 −17.68 (−0.24%)

USD Index 95.98 +0.05 (+0.05%)

Important events for today:
  • - China Manufacturing PMI (m/m) at 03:00 (GMT+2);
  • - China Non-Manufacturing PMI (m/m) at 03:00 (GMT+2).

by Justforex, 2021.12.31

We advise you to get acquainted with the daily forecasts for the major currency pairs.

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

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