World stocks mostly fall on ‘uncertain 2022’

Stock markets mostly retreated Wednesday as a “Santa Claus rally” showed signs of fatigue amid lingering fears over the Omicron variant and uncertainty about economic prospects for 2022.

Covid-19 cases have surged across the world, prompting governments to impose new measures to limit contagion while the travel industry faced thousands of flight cancellations.

Oil prices dropped Wednesday, while the dollar steadied against major rivals.

Warnings from the World Health Organization that the risk from the variant remains “very high” have compounded the sense that the pandemic is far from over, though data showing a reduced risk of hospitalisation has lifted spirits.

“With market activity much reduced for the holiday season, investors continue to tentatively price in a global recovery hitting a minor bump, and not a pothole,” noted Jeffrey Halley, senior market analyst at OANDA trading group.

Reflecting the uncertainty, Tokyo closed lower in thin holiday trade on Wednesday, with the market weighed down by US futures losses.

But London rose in midday deals, as the benchmark FTSE 100 index resumed trading after a long holiday weekend. UK traders were catching up with gains across eurozone indices on Tuesday.

China’s main stocks index fell in a slide analysts attributed partly to losses for major liquor brands -- including Kweichow Moutai, one of the world’s biggest drinks companies.

Expectations that the country’s central bank will add further stimulus in 2022 offered some hope.