Stocks Extend Advance, While Treasuries Decline: Markets Wrap

(Bloomberg) — Stocks extended their advance amid appetite for risk assets. Treasuries fell.

The technology-heavy Nasdaq 100 climbed 2%, with chipmaker Micron Technology Inc. jumping on an upbeat forecast. Nike Inc. rallied as revenue in North America increased, offsetting a drop in China. Pfizer Inc. and Merck & Co. traded off session lows as Bloomberg News reported the U.S. Food and Drug Administration was set to authorize their pills to treat coronavirus as soon as this week.

Novavax Inc.’s top executive said the company expects to have data on its Covid-19 vaccine’s efficacy against the omicron variant within days. U.K. Prime Minister Boris Johnson noted he doesn’t plan to impose new restrictions on activities before Christmas. South Africa, where the new strain was first identified, saw daily infections slump to the lowest in two weeks.

“The omicron’s potential damage to economic activity will be reasonably short and shallow,” said Art Hogan, chief market strategist at National Securities. “With household and corporate balance-sheets in good shape and sentiment still strong, we think it’s reasonable to expect that the economy will manage to navigate the rough waters.”

Earlier Tuesday, Credit Suisse Group AG’s global investment committee slashed its stocks allocation to neutral from overweight, citing increasing risks from the omicron variant.

What to watch this week:

EIA crude oil inventory report Wednesday
Bank of Japan Governor Haruhiko Kuroda speaks Thursday
U.S. consumer income, new home sales, U.S. durable goods, University of Michigan consumer sentiment, initial jobless claims. Thursday
Friday: U.S. markets are closed. European markets close earlier

For more market analysis, read our MLIV blog.

Some of the main moves in markets:

Stocks

The S&P 500 rose 1.6% as of 2:30 p.m. New York time
The Nasdaq 100 rose 2%
The Dow Jones Industrial Average rose 1.5%
The MSCI World index rose 1.5%

Currencies

The Bloomberg Dollar Spot Index was little changed
The euro was little changed at $1.1278
The British pound rose 0.4% to $1.3263
The Japanese yen fell 0.5% to 114.13 per dollar

Bonds

The yield on 10-year Treasuries advanced six basis points to 1.49%
Germany’s 10-year yield advanced six basis points to -0.31%
Britain’s 10-year yield advanced 10 basis points to 0.87%

Commodities

West Texas Intermediate crude rose 3.7% to $71.16 a barrel
Gold futures fell 0.4% to $1,788.30 an ounce

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