Evergrande is again on the brink of default
Driven by omicron-related worries and the disappointing jobs report, Wall Street stocks fell on Friday. The US economy created just 210,000 jobs last month versus the 550,000 median forecast. On the positive side, the unemployment rate fell sharply to 4.2% versus 4.5% expected. As for omicron, the virus was detected in the United States, with symptoms so far reported as mild. As such, the Dow Jones fell 0.17%, the S&P 500 shed 0.8% and the Nasdaq dipped 1.9%.
Asian equities were mixed-to-lower on Monday as China Evergrande is again on the brink of default – the troubled company said no guarantee it can make $82.5-million debt payments while creditors have also demanded a $260-million repayment. Against this backdrop, Evergrande stocks plunged nearly 20% during the session, pushing the Hang Seng index 1.76% lower. MSCI’s broadest index of Asia-Pacific shares outside Japan dipped 0.8%.
In Europe, stocks opened higher to start the day, mirroring the more buoyant mood in US stock index futures as sentiment is leaning towards being more upbeat. Still, there have been cases identified in 16 states already as of Sunday. The pan-European Stoxx 600 gained 0.7% in early trade. On the data front, Germany’s October factory orders contracted 6.9% versus -0.5% m/m expected.
In currencies, the dollar is mostly positive amid a recovery in US Treasury yields, as the hawkish Fed expectations continue to keep the greenback afloat. As such, EURUSD is back below the 1.1300 figure and could struggle under the descending 20-DMA, especially as the US CPI report looms (due on Friday).
