GLOBAL MARKETS – Global equities falter as Didi delisting reignites US-China concerns

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Band Tom Westbrook

SYDNEY, December 3 (Reuters)Shares fell on Friday after Chinese ridesharing giant Didi announced it would be delisting in New York City, rekindling concerns over US-China tensions and tech regulation, as oil headed for a sixth Back-to-back weekly drop on Omicron and concerns about rate hikes.

S&P 500 Futures ESc1 fell about 0.5%. Hong Kong Hang Seng .HSI fell 1.3%, driven by big names in tech. The MSCI index of Asian stocks excluding Japan .MIAPJ0000PUS fell 0.7%. .HK

The risk-sensitive Australian dollar AUD = D3 fell 0.3% and just under 71 cents is near a one-year low. EUR /

Have I got DIDI.N clashed with Chinese regulators in continuing its $ 4.4 billion US IPO in July and said on Weibo that it was looking to move its listing to Hong Kong.

“The write-offs that are starting to occur are causing some nervousness about the uncertainty as to their impact on the larger situation between the United States and China,” said Moh Siong Sim, analyst at the Bank of Singapore.

Didi’s news comes a day after Singapore-based rideshare and delivery company Grab ENTER.O slipped more than 20% on his Nasdaq debut. Listing is highest on Wall Street by a Southeast Asian company.

More broadly, markets have flipped on little hard news on Omicron this week, dragging down the CBOE Volatility Index .VIX towards its biggest week-long jump since the pandemic chaos of February 2020. Short-term yields have also jumped as investors bet on higher rates, even with Omicron uncertainty.

Traders will have to wait at least a week or so for an early reading of the virulence or vaccine resistance of the variant. US labor data due later Friday is also the focus of attention as a guide to rates.

Benchmark futures on Brent crude LCOc1 finished higher overnight at $ 69.67 a barrel, but has fallen more than 3% this week and is down more than 18% from October’s three-year high.

So far, in the absence of details on Omicron, some governments have still made efforts to close the borders. But other policymakers – notably the Federal Reserve – are moving cautiously to the pace of plans to move away from crisis-mode responses.

Fed Chairman Jerome Powell said central bankers would talk about a faster decline in bond purchases at this month’s meeting and stop describing inflation as transient. OPEC’s oil cartel is moving forward with planned production increases.

“The Fed is not ignoring Omicron’s threat, but is choosing not to let it delay policy responses that suggest a more business-as-usual perspective,” said Tobin Gorey, Commonwealth Bank of Australia strategist.

“OPEC + has done the same,” he added. “Neither has frozen their planned policy changes… and both are perhaps examples that suggest that lockdown responses to outbreaks are becoming less likely. “

The bond market’s response to Powell’s hawkish turn has been to raise short-term rates and lower long-term rates, believing that earlier hikes will ultimately dampen future inflation and growth, and flatten the curve sharply. of American rates. WE/

Two-year Treasury yields US2YT = RR were flat at the start of trading in Asia for a weekly gain of nearly 10 basis points.

Benchmark yields on 10-year treasury bills US10YT = RR, on the other hand, fell almost 6bp to 1.4291% this week and 30-year rates US30YT = RR were down 7.3 basis points to 1.7545%.

“It is inflation, not growth, that is pushing the Fed to accelerate its tightening plans,” said Kit Juckes, strategist at Societe Generale in London.

“For the first time in ages, the risk to this US economic cycle is that it will end sooner than expected by consensus forecasts,” he said, predicting that the bullish momentum of the US dollar could slow down. to peak around the middle of next year. .

Investors sold riskier currencies on Friday. The risk-sensitive Australian and New Zealand dollars lost around 0.3% each. The euro EUR = EBS was stable at $ 1.1298 and the yen JPY = EBS closes at 113.08 per dollar. FRX /

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(Reporting by Tom Westbrook; Editing by Sam Holmes)

((tom.westbrook@tr.com; +65 6973 8284;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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