World stock markets advanced Thursday on fading fears over both the Omicron coronavirus variant and elevated inflationary pressures, dealers said.
Natural gas prices continued to fall sharply from record peaks that were struck earlier this week, but crude oil pushed upwards.
The upbeat pre-holiday mood was helped by two preliminary studies from Britain indicating Omicron infections were less likely to result in hospitalisation compared with the Delta variant, confirming a trend first identified in South Africa.
Global equities climbed on “optimism that Omicron could lead to fewer hospitalisations than Delta”, noted Interactive Investor analyst Victoria Scholar.
The cautious optimism was also lifted by news that the US Food and Drug Administration had authorised Pfizer’s anti-Covid pill, providing fresh tools to battle the disease, followed by the one produced by rival Merck.
Sentiment won another shot in the arm after Britain’s AstraZeneca revealed that the third, or booster, dose of its Covid-19 vaccine “significantly” lifted antibody levels against the Omicron strain in a laboratory study.
New cases of the highly mutated Omicron strain continued to soar, but market watchers are becoming more confident the health effects will be milder than with earlier variants.
The rebound from Monday’s sharp sell-off over Omicron fears “doesn’t mean the market isn’t concerned about Omicron”, said Briefing.com market analyst Patrick J. O’Hare.
“But it does suggest the market isn’t overly concerned about Omicron doing any extended economic damage.”
Data released Wednesday showed US consumers remained upbeat about the economy despite the rise of the fast-spreading Omicron strain.
The Conference Board’s consumer confidence index jumped nearly four points to 115.8 compared to the prior month.
Sentiment was also boosted by revised data from the US Commerce Department showing GDP expanded at a faster annual rate of 2.3 percent in the third quarter, up from earlier estimates of 2.1 percent.
The positive mood spilled over into Asia Thursday, with Tokyo adding 0.8 percent.
Even a Covid lockdown in the Chinese city of Xi’an failed to dampen enthusiasm, with Shanghai closing 0.6 percent higher and Hong Kong up 0.4 percent.
Data released Thursday morning showed the US economy continues to motor along, with personal income and spending rising, as did orders for durable goods. First-time unemployment claims remained at pre-pandemic levels.
Thursday is the last trading day before Christmas for Wall Street, as it is for the Frankfurt stock exchange. Both London and Paris are open for half of a day of trading on Friday.
“It might not be like some of the Santa rallies of years past, but at least markets have managed to claw their way higher this week,” said Chris Beauchamp, chief market analyst at IG trading platform.
Stock markets often experience what traders call a Santa rally around the Christmas and New Year holidays when trading volumes are low.
– Key figures around 1630 GMT –
New York – Dow: UP 0.6 percent at 35,952.53 points
EURO STOXX 50: UP 1.2 percent at 4,265.86
London – FTSE 100: UP 0.4 percent at 7,373.34 (close)
Frankfurt – DAX: UP 1.0 percent at 15,756.31 (close)
Paris – CAC 40: UP 0.8 percent at 7,106.15 (close)
Tokyo – Nikkei 225: UP 0.8 percent at 28,798.37 (close)
Hong Kong – Hang Seng Index: UP 0.40 percent at 23,193.64 (close)
Shanghai – Composite: UP 0.6 percent at 3,643.34 (close)
Euro/dollar: DOWN at $1.1316 from $1.1326 late on Wednesday
Pound/dollar: UP at $1.3405 from $1.3352
Euro/pound: DOWN at 84.39 pence from 84.83 pence
Dollar/yen: UP at 114.36 from 114.10 yen
Brent North Sea crude: UP 1.0 percent at $76.07 per barrel
West Texas Intermediate: UP 0.9 percent at $73.41
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