Markets are still torn between what appears to be a solid economic outlook for 2022 and turmoil linked to the pandemic and inflation. The return to less exuberant monetary policies, particularly in the US, has lowered risk tolerance and is contributing to increased volatility as the year ends. This has resulted in some mood swings. Yesterday morning, investor sentiment took a hit from the announcement of new restrictions in many regions to curb the advance of the Omicron variant. But as is often the case in recent weeks, traders were quick to buy back the session's lows: when valuations are tight, one is content with small air gaps to reload positions. After all, this is a technique that has been working for months, even years, thanks to the largesse of central banks. The fact that they are looking to disengage is of course a concern…

Countries are struggling to stop Omicron's advance, but without success. The United States has just revealed that 73% of the contaminations on its territory are due to the new variant, against 3% the week before. The bans that have been implemented everywhere seem very small in the face of this tidal wave.

 

Economic highlights of the day:

The dollar is trading at EUR 0.8860. Gold lost ground at USD 1796 per ounce. In the oil market, the barrel is slightly up at USD 73.11 for Brent and USD 70.27 for WTI. US debt is paying 1.42% on 10 years. The bitcoin wakes up USD 48730.

 

On markets:

* Nike- The sports equipment maker on Monday reported better-than-expected quarterly revenue and profit on strong demand in North America and said it was confident that problems affecting supply chains would improve in its upcoming annual fiscal year. The stock is up 3.7% in after-hours trading.

* Moderna- Stephane Bancel, Moderna's chief executive, said Tuesday that his group does not expect to encounter problems developing a booster dose of its COVID-19 vaccine targeting the Omicron variant of the coronavirus and that clinical trials could begin in early 2022.

* Aridis Pharmaceuticals soared 108% to $5.29 in premarket trading as the biopharmaceutical company announced it had developed a monoclonal antibody cocktail against COVID-19 that retains efficacy against the Omicron variant of the coronavirus.

* Micron Technology gained 8.4% in pre-market trading Monday on the heels of the semiconductor maker's release of a second-quarter profit forecast that beat analyst expectations.

* Tesla, whose stock lost all the gains it had made since announcing a 100,000-car order from Hertz in October, rebounded 1.7 percent in premarket trading Tuesday.

* Nordstrom gained 2 percent in premarket trading after the department store chain said it was considering a spin-off of its Nordstrom Rack discount store subsidiary, according to Bloomberg.

* General Mills - The food company fell 5.2% in premarket trading after lower-than-expected quarterly results linked in part to higher raw material, transportation and labor costs.

* The Boeing Company, AT&T, Verizon - Dave Calhoun, Boeing's chief executive, and Jeffrey Knittel, his counterpart at Airbus' North American arm, urged Joe Biden's administration in a joint letter Monday to delay the launch of services AT&T and Verizon are scheduled to deploy Jan. 5 in 5G C-band because of a potential disruption to aviation.

* McDonald's Corporation- The U.S. company's Japanese arm, McDonald's Holdings Japan, announced plans Tuesday to suspend sales of medium and large fries for a week, starting Friday, due to supply issues.

* Amazon - Casino Group and its renewable energy subsidiary Greenyellow announced Tuesday a strategic collaboration agreement with Amazon Web Services in the areas of energy and cloud computing.

 

Analyst recommendations:

  • Alibaba: Atlantic Equities downgrades Alibaba Group to Neutral from Overweight; Price Target is $140
  • Centrus Energy: Roth Capital Partners raised its recommendation on Centrus Energy Corp. Class A to buy from neutral. PT up 23% to $58
  • Cigna: J.P. Morgan downgrades to neutral from overweight. PT up 14% to $248
  • HCA Healthcare: J.P. Morgan downgrades to neutral from overweight. PT up 9.9% to $270
  • Herc Holdings: Baird downgrades to neutral from outperform. PT up 3.9% to $161
  • KLA Corporation: Wells Fargo Securities upgrades to overweight from equal-weight. PT up 30% to $500
  • McDonald's Corporation: Edward Jones downgrades McDonald's to Hold from Buy
  • Micron Technology: Mizuho Securities adjusts Price Target to $98 from $95, reiterates Buy rating
  • Oracle: KeyBanc downgrades Oracle to Sector Weight from Overweight
  • Petrofac: Morgan Stanley resumes its Overweight rating with a target of  GBp 126.88.
  • Reckitt: Barclays remains Overweight with a target raised from GBp 8900 to GBp 9400.
  • ResMed: KeyBanc Capital Markets raised the recommendation to overweight from sector weight. PT up 22% to $302.
  • TUI AG: Peel Hunt starts tracking at Hold with a target of GBp 210.
  • United Rentals: Baird cut its recommendation to neutral from outperform. PT down 1.5% to $317
  • Wizz Air: AlphaValue starts tracking at Buy, targeting GBp 4024.