European stocks wrap up early, wary of Omicron fears

283
2
European stocks wrap up early, wary of Omicron fears

European stock markets wrapped up early on Friday in subdued Christmas Eve trade, as investors pondered the Omicron coronaviruses fears, with European stock markets wrapping up early before the long holiday weekend.

Asian equities went up in thin volumes after Wall Street ended its trading week Thursday with strong gains on solid economic data.

The London and Paris stock exchanges ran out of steam in a half-day session, with traders somewhat wary of the restrictions on Omicron.

AvaTrade analyst Naem Aslam told AFP that markets are reticent today due to lower volumes as traders are away for a holiday period.

We believe there is still lots of optimism about Covid vaccines - but concerns are real that more restrictions may be placed ahead of New Year's Eve to curtail the spread of Covid. Frankfurt's DAX index had shut on Thursday, closing the week with a 1.0 percent gain at 15,756. 31 points.

Studies showing that Omicron infections are less likely to result in hospitalization have increased confidence that the pandemic will have less impact on the economy.

Sentiment has been buoyed by US approval of drugs from Merck and Pfizer to add to a growing arsenal of weapons against Covid.

Omicron is looking more like a short-term disruption to the economic outlook and not a destructive force that knocks the economy off course, said Edward Moya, OANDA analyst.

On Wall Street, the S&P 500 ended the last session before the long holiday weekend at a new record after a raft of decent US economic data.

Consumer spending climbed in November, though at a slower rate and new home sales increased.

Jobless benefit claims held steady from the previous week and orders for big-ticket manufactured goods climbed, though mostly due to aircraft.

Inflation was the biggest increase in nearly four decades, illustrating the delicate balance that the Federal Reserve faces between reining in inflation and keeping the economic recovery on track.

Omicron will cause some slowdowns in the economy, perhaps some slowdowns of production which could add to inflation pressures in the short term, according to Paul Christopher, head of global market strategy at Wells Fargo Investment Institute, told Bloomberg Television that the economy would work its way through the situation.

The optimistic mood carried over to Asia with most markets rising, although in quiet trade with several stock exchanges shut or on shortened hours ahead of the Christmas holiday.

New York - Dow was up 0.5 percent at 35,950. The Euro dollar has gone up at 56 close to the close on Thursday: UP at $1.1335 from $1.1327

Brent crude in the North Sea was down 1.2 percent at $75.95 per barrel.