S&P500
The US stock market is approaching yearly highs as investors eye the meeting of the Federal Reserve on Wednesday.
Main US indexes closed strongly on Friday, with the Dow Jones adding 0.6%, the Nasdaq gaining 0.7% and the S&P 500 increasing by 1%.
The S&P 500 futures have risen by 0.3% early Monday.
Asian markets finished the Monday's session in positive territory, with the Nikkei 225 gaining 0.9% and the Shanghai Composite rising by 0.7%.
On Sunday, the World Health Organization announced that the new Omicron strain of COVID-19, which is currently spreading rapidly worldwide, is less severe than the earlier Delta strain. Yesterday, 435,000 new COVID-19 infections were reported. South Africa registered 38,000 new cases and 21 deaths due to the coronavirus outbreak caused by Omicron. In Russia, about 30,000 new cases and 1100 deaths were reported. In the best case scenario, Omicron could displace deadlier strains of the coronavirus. However, COVID's pressure on healthcare systems still remains high as many cases require hospitalization.
Oil prices are gradually recovering following the crash of November 26. Brent crude oil closed on Friday at $76.35 per barrel, increasing by 1.5%.
The S&P 500 is trading at 4,712 and is expected to be in the 4,680 - 4,740 range. The index closed above 4,700 on Friday, as the market is ready to extend its upside. The Federal Reserve will meet on Wednesday, followed by a meeting of the European Central Bank on Thursday. With inflation continuing to soar in the US, the Fed could take a hawkish position. According to data released on Friday, inflation in the US went up by 6.8% annually in November, compared to an increase of 6.2% in October. The main contributor to rising prices was petroleum - fuel prices in November gained 3.5% month-on-month and 33% year-on-year, pushing up the costs of shipping. Amid high inflation, the Fed hinted it could accelerate QE tapering and fully wind down bond buying in March 2022. Earlier, the regulator planned to end monetary stimulus in June 2022.
General Motors is planning to invest $3 billion into establishing production of electric vehicles in the state of Michigan.
US president Biden stated that income growth in the US is outpacing the rising prices, and that American households have more cash in their pockets now than in 2020.
US companies have paid a record high $934 billion through share buybacks in the third quarter, amid an ongoing investment boom in the US. ETF inflows have topped $1 trillion for the first time.
USDX is trading at 96.20 and is expected to be in the 95.90 - 96.50 range. The US dollar index's movement was unaffected by inflation data and is likely to remain limited until the Fed's meeting.
USD/CAD is trading at 1.2730 and is expected to be in the 1.2620-1.2850 range. In the run-up to the Fed's meeting, the pair is trading in a wide range, finding a balance between stronger USD and rising oil prices.
The US market is set to push new highs before Christmas, but any hawkish statements by the Federal Reserve could ruin the holiday season for investors.