Wednesday, December 8, brings only a few key economic reports to keep an eye on.
First off, Japan published annualised GDP growth for the third quarter. It was lower than predicted at -3.6%. The QoQ growth rate for the same period also failed to meet investors’ expectations.
The other notable event today is the monetary policy meeting of the Bank of Canada. The regulator has already cemented its position as one of the most hawkish central banks amid developed countries and has stopped its asset purchases already. It is unclear whether there will be another hike today, but there will likely be more details on when we can expect it.
Today Omicron continues to be one of the most talked-about topics in the financial sector. Data from South Africa has shown that the new variant is indeed capable of resisting the existing coronavirus vaccines, thanks to all of its mutations.
Though Omicron doesn’t seem to be particularly dangerous in terms of its symptoms, the confirmation that vaccines are less effective against it still managed to curb optimism somewhat.
Even if the new variant doesn’t cause severe illness, the rate at which it is able to spread is alarming. Countries in Europe are already seriously considering new lockdowns. The United Kingdom, whose government kept insisting that the country will avoid further restrictions thanks to a successful vaccination campaign, is reportedly also heading for a fresh lockdown.
US stock indices today will open with a mixed bias. The Dow Jones index is more dependent on economic recovery than the rest and will likely trade lower, while the more tech-focused S&P 500 and Nasdaq 100 may gain today.
In other news, we have more details about the important call between Joe Biden and Vladimir Putin that took place yesterday.
The United States President stated that should Russia invade Ukraine once more, it will face strict economic sanctions. In addition, the US is prepared to send military aid to the region if its allies in Eastern Europe ask for it.
For his pair, Russian President Putin retorted that he would not touch Ukraine, as long as Biden guarantees that NATO would stop spreading its influence further and further east. However, President Biden answered that the US alone cannot be responsible for the political decisions of other countries. Thus, he was not able to give Putin the assurances he wanted.
Still, the call helped ease some of the diplomatic hostilities between the two countries. Both presidents expressed a desire to continue their discussion soon.
