FTSE 100 Live: Federal Reserve boss fuels Omicron market volatility

- Advertisement -


M

The market volatility continues from the Omicron version following overnight comments by US Federal Reserve boss Jerome Powell.

- Advertisement -

He signaled a swift end to America’s massive bond-buying program and shook Wall Street by retiring the word “transient” to describe the outlook for inflation.

- Advertisement -

Powell’s comments sent the S&P 500 down nearly 2% overnight, under pressure due to doubts about how effective vaccines will be against the latest strain of Covid-19.

live update

1638344359

Powell’s warning added to the pressure in the market

Federal Reserve boss Jerome Powell has put pressure on the markets by signaling a faster-than-expected US stimulus.

Powell also told the Senate Banking Committee that inflation could last longer than expected, a change from his previous guidance that price pressures are transient.

His case of a sharp reduction in economic support came despite ongoing uncertainty over the Omicron version, which Powell warned could slow labor market progress and intensify supply chain disruption.

The accelerating wind of the Federal Reserve’s $120 billion-a-month asset purchase plan opens the door to higher-than-expected interest rates.

That likely led to a sharp increase in Treasury yields, lower earlier in the day after Moderna’s boss warned existing vaccines might not be so effective against the new strain.

Comments from Powell and Moderna boss Stephen Bansell were unhelpful to Wall Street as the S&P 500 closed nearly 2% lower for its lowest level in a month.

Jim Reid, market commentator at Deutsche Bank, said: “It’s hard to say how widespread this decline was, as just seven companies in the entire S&P rose yesterday, the lowest number for the whole year and the lowest since June 11. , 2020.”

The FTSE 100 index fell 0.7% yesterday in the wake of the Moderna warning, after Omicron’s version discovered it fell 3.6% on Friday.

CMC Markets expects London’s top flight to open 64 points higher at 7123, focusing on the Europe-wide release of monthly data covering the manufacturing sector.

,

- Advertisement -

Stay on top - Get the daily news in your inbox

DMCA / Correction Notice

Recent Articles

Related Stories

Stay on top - Get the daily news in your inbox