Macro-bound week to steer equities as Omicron worries stay

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Macro-bound week to steer equities as Omicron worries stay

 Macro-bound week to steer equities as Omicron worries stay
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Highlights

  • Equities have seen one of the most turbulent sessions in last days
  • Macros are likely to steer the markets in week ending 10 Dec
  • IBEX 35 of Spain has been the worst performer among the major peers

Global equity markets have seen one of the most turbulent sessions in the present calendar year with the leading stock averages from New York-to-London-to-Tokyo feeling the pinch of increased volatility on the back of the Omicron variant of Covid-19 (SARS-CoV-2) and the rising number of infections in many European nations.

As many countries contemplate the possibilities of reintroducing the stern border control measures, alongside tightening the local restrictions, markets are likely to remain choppy in the upcoming sessions.

A lower-than-expected trading period around the Christmas festivities and the year-ender holidays due to such reciprocatory curbs by the regional governments can potentially derail the businesses from the path of recovery, potentially affecting the market momentum and the subsequent rate of economic expansion.

Financial markets across the world will be largely guided by the macroeconomic updates in the week ending 10 December, 2021 regional data centres prepare to release periodic updates that can either substantiate the pace of economic expansion in the months of October-November, or can portray the tightened business environment.

Australia is due to report the Ai Group Services Index, the final reading of Building Permits, while the Reserve Bank of Australia will deliver the interest rate decision. Amid the major European peers, Italy, Germany, the UK, France are slated to report the Construction PMI data, alongside the Euro Area and retail sales of Italy.

Balance of trade data for China, US, Canada, Germany and the UK. Inflation figures for China, US and the UK, GDP growth rate for the UK and Euro Area will also be revealed. Among the other major data points, JOLTs job openings in the US, Halifax House Price Index, new car sales in the UK will be declared.

As most of the leading stock barometers stand with huge losses in the last six sessions, there seems a likelihood of value buying as investors would like to take fresh positions in a number of beaten down stocks.

Major indices including Nasdaq Composite and Dow Jones Industrial Average of the United States, Nikkei 225 of Japan, CAC 40 of France, DAX of Germany, FTSE MIB of Italy, Hang Seng of Hong Kong are down 3-5% following the turbulent sessions in the last six days.

The losses of FTSE 100 of England and ASX 200 of Australia were contained below 3%, while the IBEX 35 of Spain declined the most among the leading stock indicators as the market index collapsed 6.8%. On the contrary, Shanghai Composite of China has managed to stay positive with a marginal gain of 0.65% in the last six days.

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