China Evergrande is on the verge of default after a missed debt payment deadline
Wall Street stocks saw another bullish session on Tuesday as omicron-related concerns continued to abate due to the reassuring comments from medical companies and other industry institutions. Of note, this time, tech stocks were leading the gains, sending the tech-heavy Nasdaq 3% higher. The Dow and the S&P 500 gained 1.4% and 1%, respectively. In individual stocks, Apple surged 3.5% after Morgan Stanley revised higher its price target on the company’s shares to $200.
In Asia, stocks extended gains on Wednesday despite some bearish drivers, including a disappointing economic report out of Japan. According to the official data, the Japanese economy contracted 3.6% in the third quarter, downgraded from the 3.0% contraction initially reported. Furthermore, private consumption fell 1.3% while public investment was revised down to a 2.0% drop from a -1.%. Meanwhile, highly indebted property developer China Evergrande is on the verge of default after a missed debt payment deadline.
European stocks opened higher today but turned mixed in recent trading, suggesting investor optimism is abating, and markets need fresh catalysts to extend recent gains. Of note, the new variant has now been found in 50 countries and 19 American states. U.S. stock index futures rose modestly in early premarket trading, suggesting the rally could slow during the upcoming session.
In the meantime, the dollar has eased marginally on Wednesday as US 10-year Treasury yields retreat. Against this backdrop, EURUSD bounced back to the 1.1300 figure that continues to cap the upside, however. Despite the bounce, the common currency remains vulnerable to further losses both in the short- and medium-term.