Pending Home Sales for October; Canada Balance of Payments for
3Q; Canada Industrial Product & Raw Materials Price Indexes for
Stock futures gained Monday, indicating major benchmarks might
recoup some losses from Friday's selloff as investors continued to
monitor the likely implications of a new variant of Covid-19.
"Friday was a panic selloff," said Ipek Ozkardeskaya, senior
analyst at Swissquote Bank. "Traders have had time to sit back and
breathe a bit," she added, saying that trading volumes were lower
over the Thanksgiving holiday, likely exacerbating declines.
Investors are awaiting more clarity on the likely
transmissibility and severity of the Omicron variant and whether it
will weigh on the efficacy of vaccines. Some money managers worry
that the new strain could hit global mobility and the economic
Israel has banned foreigners from entry and Japan has said it
will close its borders to foreign visitors until more information
about Omicron is available. The U.K. has reintroduced mask mandates
and PCR tests for travelers.
Others expect that the economic impact of the variant will be
limited as vaccine manufacturers update their shots to combat
"We know in a situation like this, we know the winds can change
very quickly. We can get one piece of news and [the market's] back
to red," Ms. Ozkardeskaya said.
Overseas, the pan-continental Stoxx Europe 600 added 0.8%.
However, major stock indexes in Asia fell.
Economists at Morgan Stanley Asia said that countries that had
instituted Covid-zero strategies, such as China, Hong Kong and
Taiwan, would likely see limited near-term economic impact from the
new variant. Others, such as Japan, South Korea and Singapore,
would suffer more, including through greater pressure on their
The dollar has started the week higher against a range of
currencies, including the euro, as investors continue to evaluate
the danger of the newly-emerged omicron variant of the coronavirus.
So far, there are encouraging signs that the symptoms appear mild
compared with other variants, but the uncertainty is still likely
to lead to greater volatility in currencies, said MUFG.
"The developments should continue to favor higher FX volatility.
European assets and currencies had already been undermined in
recent weeks by another Covid wave heading into the winter. The new
variant risks making that situation worse," MUFG said.
CBA said the dollar is likely to remain elevated this week,
particularly against commodity currencies, even as markets pare
back Fed tightening expectations due to Omicron uncertainty.
Some FOMC officials have recently suggested they are open to
upping the pace of tapering in December, but "the emergence of
omicron may delay such a policy change," CBA said.
Bannockburn Global Forex said Omicron has injected a new dynamic
into foreign exchange markets and a key risk is that uncertainty
about the level of threat is not lifted quickly, which would
It said there are three key changes since the middle of last
week: odds of a Bank of England rate increase next month have
fallen further; acceleration of Fed tapering seems unlikely, and
prospects for stronger world growth are diminished on the
"This undermines risk appetite and weakens those currencies that
often appear to do better in robust growth phases, e.g., dollar
bloc, Scandis, and most emerging market currencies."
Investors sold out of government bonds, pushing up yields.
Mizuho said omicron raises uncertainty around the effectiveness
of vaccines and brings back the possibility of full lockdowns.
"Omicron is potentially a game changer. ince there's a risk that
current vaccines are rendered much less effective, markets need to
account for the scenario in which we go back into full
Mizuho ascribed a 20-25% probability at this stage to this
scenario. This risk means that investors and central bankers will
need to be revising down their growth forecasts, reducing the
urgency of policymakers to immediately raise interest rates.
Oil futures gained more than 5% in Europe, clawing back
significant proportions of their sharp losses on Friday that came
as major economies imposed travel restrictions on countries where
the Omicron variant of the coronavirus has spread. Low trading
volumes--with the U.S. celebrating Thanksgiving--added to the
"Given the lack of information on the latest variant, one could
probably question the scale of Friday's selloff and whether it is
really justified," said ING's Warren Patterson, adding that "the
market seems to be coming to that realization in early morning
trading today, with a relief rally underway." The market's
attention will soon turn to OPEC+, which meets later this week.
Jefferies said Omicron jeopardizes what was an increasingly
positive near-term outlook for mining stocks.
"Regardless of whether this new variant is a real issue, the
sector is likely to be under short-term pressure as there is a
renewed risk of lockdowns, which would negatively impact demand and
push investors away from such a highly cyclical sector."
Still, Jefferies--which said the mining sector is otherwise
"underowned" and poised to benefit from higher metals
prices--reckons investors should buy mining stocks in bouts of
short-term weakness because the medium- to long-term fundamental
outlook is unchanged and still very positive.
TODAY'S TOP HEADLINES
Clearlake Capital to Buy Quest Software From Francisco
Clearlake Capital Group LP has struck a deal to buy Quest
Software Inc. from Francisco Partners in the latest sign of
private-equity firms' voracious appetite for software.
The deal, expected to be announced as soon as Monday, values
Quest at $5.4 billion including debt, according to people familiar
with the matter.
Amazon Builds Out Network to Speed Delivery, Handle Holiday
In the past two years, Amazon.com Inc. has added workers at an
unprecedented clip to keep up with a pandemic-induced surge in
demand. As it has done so, an even bigger expansion drew less
attention: The company is close to doubling the size of its
Amazon blanketed the country with more than 450 new facilities
used to store, sort and ship items, according to logistics
consultant MWPVL International, doubling down on a logistics empire
that aims to deliver items in one day or less, and increasingly to
do so without the help of third-party shippers.
Nissan to Spend $17.6 Billion on Battery-Powered Vehicles Over
TOKYO-Nissan Motor Co. said Monday it plans to spend $17.6
billion over the next five years as it adds 20 new battery-powered
vehicles to its lineup.
The company hopes to recapture a degree of the prominence it
held in the electric-vehicle race after its pioneering introduction
of the Leaf EV more than a decade ago. Investors have boosted the
share prices of car makers that are betting big on EVs, including
relative newcomers such as Tesla Inc. and industry stalwarts like
Ford Motor Co. and Volkswagen AG.
Covid-19 Vaccine Makers Assess Omicron Response
Vaccine makers will spend several weeks assessing the danger and
potential impact of the coronavirus's new Omicron variant.
But they are already racing to develop ways to combat it.
Activist Investor Ancora Urges Berry Global to Explore a
Activist investor Ancora Holdings Inc. is pushing Berry Global
Group Inc., a packaging manufacturer with a roughly $9 billion
market value, to explore a sale.
Ancora, which owns about 1% of Berry Global, is urging it to
explore strategic alternatives including a possible sale and make
other changes, according to a copy of a letter the activist sent to
the company's board Sunday that was viewed by The Wall Street
Airlines Avoid Thanksgiving Pitfalls as Daily Passengers Top Two
Travelers returning home Sunday after the Thanksgiving holiday
are encountering busy airports and full flights, but relatively few
of the problems that have plagued air travel in recent months.
The holiday week has been a test of whether U.S. airlines have
done enough to prevent the kinds of snafus that have resulted in
major meltdowns and thousands of canceled flights.
Australia Seeks to Make Social-Media Firms Liable for Users'
SYDNEY-Australia said on Sunday that it would introduce
legislation to make social-media companies liable for defamatory
comments published on their platforms, in a move that risks
exposing tech companies to future lawsuits.
Prime Minister Scott Morrison said the legislation also aims to
unmask people who make hurtful comments online by requiring
companies such as Meta Platforms Inc.'s Facebook to disclose their
details, such as an email address or cellphone number, when a
complaint is made.
Companies See Omicron Variant as Latest Unknown in a Pandemic
Full of Shocks
U.S. companies responded to the new Covid-19 variant with a mix
of both concern and confusion. Some executives scheduled calls with
internal teams to assess the threat or peppered health advisers
with questions, while many cautioned that they would hold off in
making changes to operations until more is known.
The fast-spreading Omicron variant pushed companies in a range
of industries to consider how safety measures and new workflows
created during the peak of the pandemic could be reinstated. It
also served as a reminder, executives say, that navigating through
the unknowns of Covid-19 is a new reality of corporate
U.S.-Listed Digital Realty Trust Unit Seeks to Raise Around $700
Million in Singapore IPO
Digital Realty Trust Inc.'s unit is planning to raise up to $682
million through a real estate investment trust listing in
Singapore, which if successful would be the largest offering in
more than four years.
Digital Core REIT, a unit of the U.S.-listed company, is
planning to sell up to 267 million units at a fixed offer price of
US$0.88 per unit, according to a term sheet seen by The Wall Street
Hertz-Tesla Deal Signals Broad Shift to EVs for Rental-Car
Car-rental customers could soon see more electric-vehicle
options on airport lots and other places where they are looking to
reserve a ride.
The rental-car industry, long a big bulk-purchaser of new models
in the car business, is sharpening efforts to add more
battery-powered vehicles to fleets, the latest in a broader global
shift among companies embracing greener technologies to cut their
Omicron Variant Is Reported in More Countries as Officials
Grapple With How to Respond
Countries around the world reported their first cases of the
Omicron variant over the weekend and some imposed new travel
restrictions, racing to protect themselves against the potentially
more contagious strain even as scientists cautioned they don't yet
know how severe it will prove to be.
Canada, Australia, the Netherlands and Austria on Sunday joined
a group of countries that have detected a strain first documented
in South Africa that authorities said could pose a greater risk of
people falling ill with Covid-19 a second time and could be more
transmissible than other variants.
Labor Talks to Start in 2022 at Congested West Coast Ports
U.S. shippers struggling with supply-chain gridlock on the West
Coast face new concerns in the coming year as dockworkers and
marine terminals gird for talks on a new labor contract.
Eurozone Economic Sentiment Declines in November
Confidence among businesses and households in the eurozone fell
in November amid rising inflation, supply-chain constraints and a
surge of coronavirus cases.
The European Commission said Monday that its economic sentiment
indicator, an aggregate measure of business and consumer
confidence, fell to 117.5 in November from 118.6 in October. The
result was in line with the forecast from economists polled by The
Wall Street Journal.
Eurozone Inflation Likely Hit Record High in November
Consumer-price inflation in the eurozone likely hit a record
high in November, but many economists think that might mark a peak
for now, and therefore don't expect the European Central Bank to
raise its key interest rate next year.
As in the U.S., consumer prices in the eurozone have risen
faster over recent months than most economists and policy makers
had expected. The data have raised questions for investors,
businesses and households about the credibility of central bank
assertions that this period of high inflation is likely to prove
Buyout Boom Gains Steam in Record Year for Private Equity
Big leveraged buyouts are back, and this year's crop might just
be a taste of things to come.
Private-equity firms have announced a record $944.4 billion
worth of buyouts in the U.S. so far this year, 2.5 times the volume
in the same period last year and more than double that of the
previous peak in 2007, according to Dealogic. So far this year,
there have been five $10 billion-plus deals in the U.S., equaling
the total in all of 2007, though still below the high-water mark of
nine in 2006.
Black Friday Brought Shoppers Back to Stores
U.S. shoppers spent more time and money at bricks-and-mortar
stores over the Thanksgiving holiday weekend than the same period
last year, though foot traffic remained below pre-pandemic
The rebound marks a reversal from 2020 when the pandemic
accelerated a yearslong shift of holiday spending occurring online
at the expense of in-store shopping. It also shows retailers were
able to secure spending on the key Black Friday selling day,
analysts say, even though discounts weren't as prevalent this year
and they spent weeks nudging customers to shop earlier in the
Black Friday Rout Shows Dangers of Margin Borrowing
Friday's global retreat from riskier assets exposes a
vulnerability of the broad market advance of the past year and a
half: the rising use of leverage, or borrowed money.
Traders said the Black Friday rout, which hammered stocks and
energy prices from France to India to the U.S., doesn't necessarily
presage a broader pullback unless further bad news about the new
variant of Covid-19 comes to light. But the reversal underscores
the fragility of the rebound from the March 2020 lows, which ranks
as the fastest return to record highs following a decline of at
least 20% from a previous peak.
The Evergrande Blueprint Worked for Other Chinese Developers,
Until It Didn't
China's property boom has spawned numerous developers that, like
industry giant China Evergrande Group, borrowed heavily to fund
Now they are inflicting unprecedented losses on international
investors as credit grows scarce and sales of new homes decline.
Investors have dumped their bonds, setting off alarms over the
Omicron Variant Not Detected Yet, but Likely Already in U.S.,
Health Officials Say
Top U.S. health officials said Sunday that the newly discovered
Omicron variant of the coronavirus is likely already in the U.S.
even though it hasn't been detected yet and urged Americans to take
precautions while scientists study its potential impact.
"If and when, and it's gonna be when, it comes here, hopefully
we will be ready for it," said Anthony Fauci, director of the
National Institute of Allergy and Infectious Diseases, in an
interview on ABC on Sunday. He said that includes getting more
people vaccinated and boosted and making sure people follow
Japan to Bar Entry of Foreigners in Response to Omicron
TOKYO-Japan will bar newly entering foreigners such as business
travelers from entering the country starting Tuesday, in response
to the Omicron coronavirus variant.
Japanese citizens and foreign residents of Japan who are
returning from trips abroad will still be allowed to enter the
country, the government said Monday.
Organized Retail Thefts Continue Over Thanksgiving Weekend
A string of organized retail thefts continued over Thanksgiving
weekend, with a Best Buy in Minneapolis becoming the latest victim
of a nationwide wave.
Over the past two weeks, stores have been targeted by groups of
people who smash windows, take merchandise and often resell stolen
goods online through fencing networks, according to officials.
Iran's Nuclear Advances Weigh on Renewed Talks
As negotiators gather in Vienna for talks aimed at reviving an
international nuclear agreement with Iran, one big question looms:
Has Tehran advanced its nuclear work so much in the past two years
that the 2015 deal can no longer be rescued?
Restoring the pact, which placed limits on Iran's nuclear
activities in exchange for relief from economic sanctions, is a top
foreign-policy goal of the Biden administration. Iran's new
president, however, has delayed restarting talks while pressing
ahead with nuclear work.
Write to email@example.com TODAY IN CANADA
Economic Indicators (ET):
0830 3Q Balance of Payments
0830 Oct Industrial Prices, Raw Materials
Expected Major Events for Monday
00:01/UK: Oct Zoopla House Price Index
01:00/JPN: Oct Steel Imports & Exports Statistics
09:00/ITA: Oct PPI
09:00/GER: Nov Bavaria CPI
09:00/GER: Nov Hesse CPI
09:00/GER: Nov Baden-Wuerttemberg CPI
09:30/GER: Nov North Rhine Westphalia CPI
09:30/UK: Oct Money and Credit - Lending to Individuals, Lending
to Businesses, Broad Money and Credit
09:30/UK: Oct Monetary & Financial Statistics
09:30/UK: Oct Bank of England effective interest rates
10:00/GER: Nov Saxony CPI
13:00/GER: Nov Provisional CPI
13:30/CAN: 3Q Balance of Payments
13:30/CAN: Oct Industrial product & raw materials price
15:00/US: Oct Pending Home Sales Index
15:30/US: Nov Texas Manufacturing Outlook Survey
23:30/JPN: Oct Labour Force Survey
23:50/JPN: Oct Preliminary Industrial Production
All times in GMT. Powered by Kantar Media and Dow Jones.
Expected Earnings for Monday
Citius Pharmaceuticals Inc (CTXR) is expected to report $-0.03
Electrovaya (EFL.T) is expected to report for 4Q.
Golub Capital BDC (GBDC) is expected to report $0.29 for 4Q.
Korn Ferry (KFY) is expected to report $1.36 for 2Q.
Malvern Bancorp Inc (MLVF) is expected to report $0.25 for
Mullen Automotive Inc. (MULN) is expected to report for 3Q.
Oncotelic Therapeutics Inc (OTLC) is expected to report for
Serinus Energy PLC (SEN-WA,SENX.LN) is expected to report for
StoneX Group Inc (SNEX) is expected to report for 4Q.
Three Valley Copper Corp (TVC.V) is expected to report for
United States Antimony (UAMY) is expected to report for 3Q.
Powered by Kantar Media and Dow Jones.
ANALYST RATINGS ACTIONS
There are no actions to report since Friday.
This article is a text version of a Wall Street Journal
newsletter published earlier today.
(END) Dow Jones Newswires
November 29, 2021 05:53 ET (10:53 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.