S&P500
The US stock market was actively rising for two days in a row.
On Wednesday, the US main stock indices showed a rise. Thus, the Dow Jones Industrial Average added 0.7%, the NASDAQ Composite increased by 1.2%, and the S&P500 grew by 1%.
On Thursday, in Asia, Japan's stock index inched up by 0.7%, whereas China's index remained unchanged.
Energy. Oil prices are moving along with the US stock indices. Thus, Brent crude jumped by $1.4 to $74.40 per barrel, almost reaching the highest level of this month. The gas crisis in Europe continues amid the cold weather. Futures prices for free volumes of gas at the ICE are trading at about $2,000 per thousand cubic meters. Gazprom has not ordered capacities for pumping gas through Poland for the third day in a row. It means that the company is not planning to increase supplies. At the same time, the new German government has so far taken a tough position on the certification of Nord Stream-2. The new gas pipeline is not prohibited, but the certification procedure was delayed.
The UK energy companies warned the government about the crisis caused by an unprecedented rise in gas prices. The largest companies in the sphere asked the UK authorities whether they understood that a jump in energy prices of 50% a year was a grave problem for the population and business. The EU authorities have already taken measures to support people, whereas the UK prefers the wait-and-see approach.
Epidemiological situation. The global number of new virus cases increased to 894,000, almost reaching the highest level logged at the end of April 2021. The US reported a jump of 232,000 in new cases, whereas the mortality rate totaled 1,643. In the UK and France, the number of infected people rose by 103,000 and 80,000 respectively. Notably, in the UK, the Omicron strain is rapidly spreading. However, the number of deaths is not rising fast. Yesterday, 140 people died.
S&P500 is trading at 4,696, the range is 4,660–4,730.
Investors are monitoring the epidemiological situation. Today, they learnt that in the US, the number of new infections surged by 323,000. On the other hand, yesterday, Scotland and the Republic of South Africa published two reports on Omicron, which unveiled that the new strain causes a severe form of the disease more rarely than the previous strain. Statistical data from the UK also proves this fact. However, the new virus strain is much more contagious. Scientists suppose that vaccination protects from a severe form of the disease, but people may still catch the infection.
Amid a surge in Omicron infections in the United States, Pfizer has received approval for its new drug against Covid-19 - Paklovid. The remedy, as Pfizer states, has a high efficiency if people take it in the first days after infection. Notably, the US authorities will distribute 500 million Covid tests to citizens for free. Such tests allow people to check whether they are infected or not.
It is obvious that such a jump in new virus cases will become the main topic for the US authorities. The question is whether the healthcare system is able to cope with a large number of patients or not. It is highly possible that the US will have to introduce a new lockdown in the near future.
Meanwhile, in November, new home sales advanced to 6.46 million on a yearly basis, thus hitting a 10-month high.
Today, the US is going to report on consumer spending and income. The market dynamic is likely to be shaped by the upcoming holidays and the authorities' announcements about the current epidemiological situation.
USDX is trading at 96.00, the range is 95.70 - 96.30
Yesterday, the US dollar dropped to the lower limit of the range. Until New Year, it will be extremely difficult to predict market changes.
USD/CAD is trading at 1.2830, the range is 1.2760 - 1.2880
The USD/CAD pair slumped amid the US dollar depreciation and a rise in oil prices.
Conclusion
Focus on the levels that markets may close at, learn the US macroeconomic reports, and follow the epidemiological situation in the UK and the US.