Wall Street advanced on Friday and the S&P 500 notched an all-time closing high, as market participants digested an inflation reading that was in line with consensus, but also marked the largest annual increase in consumer prices in nearly four decades. The Dow Jones Industrial Average rose 0.6%, the S&P 500 gained 0.95%, and the Nasdaq Composite added 0.73%. A report from the Labor Department showed consumer prices surged last month to a 6.8% annual growth rate, the highest reading in more than 39 years. Persistent inflation due to ongoing supply-chain challenges suggests the U.S. Federal Reserve could very well start tightening its accommodative monetary policy sooner than many might have hoped.
European stocks fell on Friday on nervousness around the Omicron COVID-19 variant. The pan-European STOXX 600 slipped 0.3%, down for third straight session on worries that measures to curb the spread of the Omicron coronavirus variant could hit economic recovery. France stocks were lower after the close on Friday, as losses in the Foods & Drugs, Gas & Water and General Financial sectors led shares lower. At the close in Paris, the CAC 40 declined 0.24%, while the SBF 120 index lost 0.25%. Germany stocks were lower after the close on Friday, as losses in the Retail, Technology and Consumer & Cyclical sectors led shares lower. At the close in Frankfurt, the DAX declined 0.10%, while the MDAX index declined 0.57%, and the TecDAX index lost 0.78%. European Central Bank is widely considering a temporary increase to its bond purchase plan at a policy meeting next week was seen as a dovish step.
Asian stocks pushed ahead on Monday with investors wagering markets can weather whatever comes from a host of central bank meetings this week, including the likely early end to U.S. policy stimulus. MSCI’s broadest index of Asia-Pacific shares outside Japan added 1.32%, after bouncing 1.7% last week. Japan’s Nikkei rose 0.71%, as a survey of large manufacturers found sentiment was the best since late 2018. Chinese stocks added 0.57% to last week’s 3.1% jump amid hopes for more stimulus after Beijing’s recent loosening of bank reserve requirements.
The Russian stock market ended trading under selling pressure amid an ambiguous external background. The Moscow Exchange index fell by 1.39% while the RTS index sank 1.24%.
Oil prices rose on Monday, extending gains from last Friday, helped by growing optimism that the Omicron coronavirus variant’s impact will be limited on global economic growth and fuel demand. Brent futures climbed 1.59% at 6:45 GMT, to $76.35 a barrel, after rising 1% on Friday. U.S. West Texas Intermediate (WTI) gained 1.47% at 6:45 GMT, to $72.73 a barrel, following a 1% increase in the previous session. The U.S. Department of Energy said on Friday it will sell 18 million barrels of crude oil from its strategic petroleum reserve (SPR) on Dec. 17, continuing its strategy to reduce gasoline prices.