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Stocks Poised to Move Higher On Growth Optimism, Despite Omicron and Fed Fears

U.S. stock futures rose as growth optimism outweighed the concerns about the new Omicron variant. However, both pandemic and ‘taper’ fears are still weighing on the markets.

The U.S. State Department has introduced new travel restrictions to slow the spread of the variant. Travelers entering the U.S. now must show a negative test taken within a day before entry. Some 60 other countries imposed travel restrictions as well.

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Meanwhile, reports from major companies like Walmart show that supply bottlenecks are easing. This helped boost the stock market.

At present, markets seem poised to recover from Tuesday’s selloff despite tighter monetary policy concerns. On Tuesday, Federal Reserve Chairman Jerome Powell said that the Fed could ‘wrap up’ tapering a few months early. This means that the Fed could taper quicker and sooner than expected, a prospect that shook the markets. The Fed’s hawkish comments had investors bet on mid-2022 rate hikes.

Level Chg. Chg. %
DOW Futures 34,788.00 320 0.93%
S&P 500 Futures 4,625.75 59 1.29%
Nasdaq Futures 16,394.00 235.25 1.46%

U.S. Dollar and Treasuries

Treasury yields rose as investors jumped into the stock market. The yield on the 10-year Treasury rose three basis points. The dollar remained stable against a basket of major currencies.

Price Chg. Chg. %
U.S. Dollar Index (DXY): 95.98 -0.01 -0.01%
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Yield Change Previous close
U.S. 1 Year Treasury Bill 0.264% 0.072 0.192%
U.S. 5 Year Treasury Note 1.206% 0.047 1.160%
U.S. 10 Year Treasury Note 1.478% 0.027 1.450%

 

Stocks To Watch

Shares of Apple reached a new all-time high on Wednesday, after jumping more than 3% on Tuesday. Analysts describe the surge as a flight to safety and “blue chip” tech stocks, following Omicron variant concerns.

Nvidia bounced back after dropping 2.10% on Tuesday on concerns over tighter monetary policy. Growth stocks benefited immensely from easy money, and will probably be the first ones to be hit once rates go up.

Shares of semiconductor manufacturer Advanced Micro Devices jumped with futures in premarket trading. Investors expect that economic growth will boost demand for semiconductors. On Tuesday, the stock reached its second all-time high this week, reaching $164.46.

FDA’s advisory board recommended the authorization of Merck’s oral COVID 19 therapy for at-risk patients. The Food & Drug Administration will likely reach an official decision later this week.

Commodities To Watch

Oil rose ahead of the OPEC meeting, boosted by an improved demand outlook. Gold strengthened against the dollar. 

Resource Price Chg. %
WTI Crude Oil $69.18 4.53%
Brent Crude Oil $72.50 4.72%
Natural Gas $4.45 -2.65%
Gold $1,789.00 0.70%
Silver $22.94 0.55%
Copper $4.32 0.92%

 

Crypto

Crypto markets are up despite Bitcoin dropping, as the altcoin season starts. Bitcoin’s dominance is currently 40.8%, a decrease of 0.57% over the same period. 

 

Currency Symbol Price Chg. % Market Cap.
Bitcoin BTC $57,129.68 -1.53% 1.08t
Etherium ETH $4,672.18 +1.89% 552.18b
Binance coin BNB $638.49 +1.74% 95.99b
Solana SOL $222.99 +4.23% 68.20b
Cardano ADA $ 1.59 -0.87% 49.58b

 

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