U.S. Futures Gain, Asian Shares Mixed Amid Omicron: Markets Wrap

(Bloomberg) — U.S. equity futures rose, while Asian stocks were mixed in thin trading as investors mulled the impact of the omicron variant on the global economic recovery. Shares of China Evergrande Group were suspended in Hong Kong.

S&P 500 and Nasdaq 100 contracts advanced at the start of the new year, with major markets including Australia, Japan and China all shut for holidays. Equities rallied in South Korea and Taiwan, but fell in Hong Kong, where trading in Evergrande shares were halted with no reason given.

There’s “a positive setup into 2022 with Fed and Covid headwinds to ease, and China policy tailwinds,” JPMorgan Chase & Co. strategists led by Mixo Das in Hong Kong, wrote in a report Sunday. “Overall, our economists see less disruption to economic activity and above trend global growth this quarter, particularly in Asia. In terms of Fed tightening, the moment of peak disruption for markets may also be passing.”

All eyes are on the omicron variant of Covid-19, which appears to be spreading quickly also appears to be less severe, and its impact on hospitalizations as well as governmental policies and issues like travel. In addition, the trajectory of policy by the Federal Reserve and other central banks, particularly as inflation continues to present a challenge, will be in focus into 2022. Many strategists are predicting more volatility in the year ahead as the path forward becomes less clear.

For more market analysis, read our MLIV blog.

Some of the main moves in markets:

Stocks

S&P 500 futures rose 0.4% as of 10:29 a.m. in Hong Kong
Nasdaq 100 futures gained 0.5%
South Korea’s Kospi index advanced 0.3%
Taiwan’s Taiex rose 0.4%
Hang Seng Index declined 0.3%

Currencies

The yen dropped 0.2% to 115.25
The Bloomberg Dollar Spot Index gained 0.2%
The euro fell 0.2% to 1.1350

Commodities

West Texas Intermediate crude gained 0.4% to $75.47 a barrel
Gold fell 0.1% to $1,826.61 an ounce