WASHINGTON, Dec 31 ― Global stock markets reversed gains after a day-long rally yesterday even as fresh US economic data indicated that a recent uptick of Omicron Covid-19 variant-related infections has not yet led to a surge in layoffs, a positive sign for the economy.
On Wall Street, the Dow Jones Industrial Average fell 0.25 per cent while the S&P 500 lost 0.30 per cent. The Nasdaq Composite dropped 0.16 per cent. There was also relief in Asia, where South Korea's 5.1 per cent industrial output surge may indicate some easing of supply chain problems. Chinese shares got a nearly 1 per cent lift from Beijing signaling lower interest rates in 2022, though they are set to end 2021 down 5.5 per cent.
Markets are concerned about persistent inflation and a resulting hawkish turn by the US Federal Reserve as investors start to price in a first rate hike as early as March .