U.S. Futures, Treasury Yields, Oil Rise As Sentiment Steadies

29/11/2021 Asia-pacific stocks fell on Monday, but the moves were modest compared with Friday’s global equity selloff as market participants assessed economic risks from the omicron coronavirus strain, bringing some calm back to markets. MSCI’s broadest index of Asia-Pacific shares ex. Japan eased 0.52%. Tencent marginally down 0.22%. U.S. equity futures, crude oil and Treasury yields climbed, with the 10-year U.S. Treasury yield rising past 1.50%. The rand climbed 0.92% at R16.15 against the greenback, dollar steadied somewhat at 113.71 yen, after sliding 1.7% on Friday. The dollar index held at 96.285, up 0.19%, after Friday’s 0.7% drop. ECB President Christine Lagarde said the euro zone was better equipped to face the economic impact of a new wave of COVID-19 infections or the Omicron variant.

Oil prices rebounded on speculation that OPEC+ may pause an output increase in response to the spread of Omicron. Brent crude futures climbed $2.58, or 3.6%, to $75.34 at the writing. U.S. light-sweet WTI was up $2.89, or 3.52%, at $71.14 a barrel, having tumbled $10.24 in the previous session.

Gold prices steadied on Monday as concerns over the impact of the Omicron coronavirus variant offset a stronger dollar, with investors assessing whether the emergence of the variant could change the U.S. Federal Reserve’s more hawkish stance. Gold futures up .39% at $1,795.27

These are some key events to watch this week:
• Fed Chair Jerome Powell, New York Fed President John Williams speak at a virtual event, Monday
• Bank of Japan Governor Haruhiko Kuroda speaks in Tokyo
• Powell and Treasury Secretary Janet Yellen in the U.S. Senate, Tuesday. Wednesday they front the House Financial Services Committee.
• Eurozone CPI, Tuesday
• China PMIs, Tuesday
• Eurozone manufacturing PMIs, Wednesday
• China Caixin manufacturing PMI, Wednesday
• OPEC, allies may re-evaluate plans for reviving oil supplies, Thursday
• San Francisco Fed’s Mary Daly and Richmond Fed’s Tom Barkin discuss the labor market and inflationary pressures at a virtual event, Thursday
• U.S. November jobs report Friday

LOCAL
The JSE fell 2.75% to 68,614 points, on Friday. South African scientists announced, on Thursday, that a newly identified coronavirus variant — B1.1.529 — had been detected in the country, which is thought to be behind the rising number of new cases in Gauteng. The top 40 fell 2.58%, while travel and leisure stocks, life insurers and banks plunged 9.1% , 8.05% and 7.02%, respectively. The rand hit intraday high of R16.36/$. The UK put SA back on the red list, restricting travel between the two countries, while the EU also aims to halt air travel from the region.

President Cyril Ramaphosa called on countries to “immediately lift” travel bans on South Africa and neighbouring states, describing the restrictions as “completely unjustified” and discriminatory during a televised address on the latest Covid-19 developments. South Africa remains on virus alert level 1.

NEWS:
• Five Missing at South Africa’s Impala Platinum After Mud Rush
• Omicron Pretty Mild So Far, Say South African Health Experts
• Traders Unwind Rate-Hike Bets as New Covid Fears Spread
• South Africa’s Gordhan Sees SAA Sale Completed by Early 2022
EQUITY PREVIEW:
• South African Travel Stocks Plunge as Countries Impose Curbs
• Bidvest Revenue, Profit Growth Continue to Build Momentum
• Nedbank Group CET1 Capital Adequacy Ratio 12.3% at End-Sept.
MEDIA SUMMARIES:
• Moneyweb: JSE ready for secondary and fast-track listings from Singapore
• Moneyweb: Renewables won’t cut it, says Nersa
• Moneyweb: Things are improving at Eskom – Ramaphosa
CORPORATE EVENTS:
• Annual General Meetings: CSB SJ
• Other/M&A: L2D SJ, PPC SJ

EU/UK/US
European stock markets plunged on Friday amid widespread selling as reports of a newly identified corona virus strain stoked fears, of a fresh hit, to the global economy and drove investors out of riskier assets. The pan-European Stoxx 600 slid 3.67%, with travel, oil & gas and banks hardest hit. Stay-at-home stocks gain ground. London’s FTSE skid 3.64%, Germany’s Dax dropped 4.15%, alongside CAC-40 losing 4.75% on Friday. According BioNTech/Pfizer, they have the ability to adapt their vaccine in a window of six weeks and to begin shipping them within 100 days should the new variant turn out to be a so-called ‘escape variant’. FTSE100 futures up +57points, alongside the DAX futures +90 points.

Wall Street closed sharply lower on Friday as traders returned from Thursday’s Thanksgiving Day break to concerns regarding a new and virulent strain of Covid-19. At the close, the Dow Jones was down 2.53% , while the S&P 500 was 2.27% weaker and the Nasdaq Composite saw out the session 2.23% softer. Dow futures currently up +105 points, or 0.31%, with S&P500 gaining 0.62% and the Nasdaq leading the charge at 0.91%.

November jobs report: Economists are looking for a half-million jobs to have returned in November, with the pace of hiring slowing only slightly from October’s 531,000 gain. The unemployment rate is also expected to improve further to 4.5% from October’s 4.6%, reaching the lowest level since March 2020.

ASIA
Asian stocks slipped on Monday as concerns lingered about the newly discovered and possibly vaccine-resistant coronavirus variant, gambling stocks dragged Hong Kong equities lower. Hang Seng trading 0.86% lower, alongside China’s blue-chip CSI300 down 0.45% Airline and travel-related stocks were broadly lower in early Asian trade, weighed by investor concerns over the spread of the Omicron COVID-19 variant, which has prompted tighter border controls in some countries. Australia’s economy likely contracted in the third quarter as fresh lockdowns weighed on consumer spending and investments, Q3 GDP seen -2.7%, forecast range -3.8% to -1.9%. The benchmark S&P/ASX currently down 0.60%. Japan’s Nikkei bleeding 1.45%