ASX 200 to fall as Omicron concerns linger

Highlights

  • The Australian share market is expected to fall at open on Thursday.
  • According to the latest SPI futures, the ASX 200 is likely to open 26 points or 0.35% lower.
  • On Wall Street, the Dow Jones Industrial Average slid 1.34%, the S&P 500 fell 1.18% and the NASDAQ lost 1.83%.

The Australian share market is expected to fall at open on Thursday as Omicron coronavirus variant continues to raise concerns among investors, with surging inflation risks further indicating towards earlier-than-expected tapering by the US Federal Reserve.

According to the latest SPI futures, the ASX 200 is likely to open 26 points or 0.35% lower. The benchmark fell 0.28% on Wednesday.

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On Wednesday, the US identified its first known COVID-19 case caused by the Omicron variant, making investors jittery. On Wall Street, the Dow Jones Industrial Average slid 1.34%, the S&P 500 fell 1.18% and the NASDAQ lost 1.83%. Only the S&P's utilities sector closed higher.

MSCI's all-country world index closed down 0.26% after earlier trading 1.8% higher. The broad STOXX Europe 600 closed up 1.7%, with Germany's DAX gaining 2.5% and France's CAC adding 2.4.%

Bond yields

US Treasury yields bounced on Wednesday as investors priced in that Fed would speed up the pace of its bond taper and will raise rates as soon as mid-2022.

Benchmark 10-year yields rose 4 basis points to 1.482%.

The dollar index 0.093% to 96.064. The euro was down 0.19% at US$1.1314, while the yen traded down 0.31% at US$112.7800.

Oil prices fall

Oil prices slipped as concerns over a looming supply glut weighed on prices.

  • Brent crude fell 36 cents to settle at US$68.87 a barrel.
  • US crude futures fell 61 cents to settle at US$65.57 a barrel.

Gold prices rise

Gold prices rose due to an increased demand for safe haven assets amid Omicron-induced volatility.

US gold futures settled up 0.4% at US$1,784.30 an ounce.

Meanwhile, Chinese coking coal and coke futures advanced on Wednesday, buoyed by supply concerns, as coal imports from Mongolia were disrupted by the recent outbreak of the Omicron coronavirus variant. The benchmark iron ore futures on the Dalian exchange DCIOcv1, for January delivery, jumped 1.6% to 624 yuan a tonne at close.

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