Market

Latest news updates: Brazil confirms Latin America’s first reported cases of Omicron variant

Wall Street stocks sank on Tuesday, as concerns about the potentially damaging economic effects of the Omicron coronavirus variant and hawkish comments from the chair of the US central bank swirled through markets.

The benchmark S&P 500 index was down 1.6 per cent, erasing gains made on Monday. The tech-heavy Nasdaq Composite share gauge also dropped 1.4 per cent.

In prepared remarks on Monday, Jay Powell, Federal Reserve chair, said rising Covid-19 cases and the Omicron variant, “pose downside risks to employment and economic activity and increased uncertainty for inflation”.

The move in markets was amplified on Tuesday by the suggestion from Powell, during congressional testimony, that the US central bank may be open to accelerating its monetary tightening programme to combat inflation.

His comments helped push up shorter-dated Treasury yields, which track interest rate expectations, and weighed down longer-dated Treasury yields, which move with growth and inflation expectations. The difference between five- and 30-year Treasury yields narrowed by the most since March 2020.

The two-year Treasury yield, which is particularly sensitive to interest rate expectations, rose 0.04 percentage points to 0.52 per cent.

Earlier, Europe’s Stoxx 600 index closed 0.9 per cent lower, following a choppy day of trading marked by worries about the new variant’s potential to evade vaccines. Hong Kong’s Hang Seng index and Tokyo’s Nikkei 225 each shed 1.6 per cent.

Read more on the day’s market moves here.

Most Related Links :
Business News Governmental News Finance News

Need Your Help Today. Your $1 can change life.

[charitable_donation_form campaign_id=57167]

Source link

Back to top button