Stock Markets Turn Around, But Won’t Last Long From FinanciaLounge

Equities should resume the positive trend after the stop in recent days caused by the spread of news regarding the Omicron variant and the words of the Fed on inflation

The variant Omicron and the words of the Fed chairman Jerome Powell, which has brought down the judgment on the transitory nature of inflation, have brought strong volatility on the financial markets, and investors are wondering what to expect in the coming months. In fact, in recent days they have experienced a sudden emotional reaction due to two disruptive events. The first was the discovery in South Africa of the new Omicron variant, with initially particularly alarming news, moreover while Europe was experiencing a particularly delicate situation, due to the obvious difficulties in managing the fourth pandemic wave.

HIT SECURITIES SENSITIVE TO LOCKDOWN

In a comment titled not surprisingly “Dietrofront”, Massimo de Palma, Head of Multi Asset Team di GAM SGR, points out that this has led to an intense correction in equity markets, especially affected in sectors most sensitive to lockdowns, such as “travel and leisure”, which in Europe have canceled the positive performances produced since the beginning of the year. Commodities linked to the economic cycle, such as oil, have experienced steep falls, exceeding 10%, and even the dollar, on the potential change of scenario, it retraced against the main currencies. Traders thought that pricing three rate hikes over the course of 2022 had become excessive …

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** This article was written by FinanciaLounge

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