Global market troubled by Omicron vaccine concerns

Traders work on the floor of the New York Stock Exchange (NYSE) on October 27, 2021 in New York City.

Brendan McDermid | Reuters

LONDON – Global markets have once again stirred up concerns that the new Omron COVID-19 variant could potentially evade vaccines.

Although health officials have said it will take several weeks to get a full picture of how Omicron’s 30+ mutations affect response to existing vaccines, Moderna CEO Stefan Bansel told the Financial Times on Monday that he expects Will be less effective against the new strain. , Bansel also told CNBC on Monday that it could take months to develop and ship a vaccine that specifically targets the Omicron variant.

Shares in Asia-Pacific fell during Tuesday’s trade, with South Korea’s Kospi down 2.4% and Hong Kong’s Hang Seng index down 1.9%. Japan’s Nikkei 225 fell 1.6%.

European stocks opened for all but erased Monday’s gains on Tuesday, after markets attempted to launch a rally following Friday’s sharp global selloff. The pan-European Stokes 600 index was down 1.6% by mid-morning.

Stateside, Dow futures were down more than 550 points in early premarket trade as concerns over vaccine efficacy reversed a rally in sentiment following President Joe Biden’s claim that economic lockdowns and further travel restrictions were currently off the table.

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The spot price of gold rose more than 0.5% to $1,794 per troy ounce, while fellow traditional safe haven Japanese yen also rose. The dollar was down 0.7% against the yen at 112.7 on Tuesday morning.

The yield on the benchmark 10-year Treasury note fell 10 basis points to 1.4273% at 4:30 a.m. ET. The yield on the 30-year Treasury bond fell 6 basis points to 1.8166%. The return is the opposite of prices and is equal to 1 basis point 0.01%.

In the crypto space, bitcoin fell 2.75% to $56,520. Oil prices also retreated, with international benchmark Brent crude slipping 3.2% to $71.12 a barrel and US crude falling 2.8% to $67.97.

The move came after European and US stocks attempted a relief rally on Monday following comments from a South African doctor who raised alarm about the new version. Dr. Angelique Coetzee said that Omicron’s symptoms have so far been mild.

Charlambos Pesoros, Head of Research at JFD Bank, said the week’s moves so far are proof of how sensitive market participants are to headlines.

“We believe this will be a core theme for some more time. With this in mind, we are very reluctant to say that market concerns have eased, and yesterday’s rebound is the start of a longer-lasting recovery. Any new negative headline is highly likely to result in another phase of massive sales,” said Pesoros.

Various analysts have warned that volatility could increase in the coming weeks, but urged investors to stay on course and keep an eye on unchanged long-term fundamentals.

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