LIVE MARKETS Going bargain hunting? Forget the fundamentals!

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GOING BARGAIN HUNTING? FORGET THE FUNDAMENTALS! (1053 GMT)

Omicron jitters have boosted volatility levels across markets and given uncertainty is far from being over, wild swings look here to stay.

That however could provide those who bet the new virus variant won’t detail the recovery with a fresh bargain hunting opportunity.

Should that happen, what exactly should investors be looking at to avoid trading missteps?

Investment bank Liberum believes support levels rather than company fundamentals are key.

“As markets decline, we do not expect fundamentals to play any major role. In a sentiment-driven sell-off due to the Covid pandemic, investors will indiscriminately sell off all stocks that are projected to suffer from further lockdowns or a delayed economic recovery,” said Liberum strategist Joachim Klement.

“The experience of managing money ourselves has taught us that in these cases it is better to look at chart technical levels rather than fundamentals to understand where share prices might find a bottom,” he added.

In the snapshot you see a Liberum screen with the most liquid European stocks and their support levels.

(Danilo Masoni)

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STOXX SEES BROAD BOUNCE (0847 GMT)

European shares are off to a positive start of the week this morning with the STOXX 600 (.STOXX) up 0.7%, while all sub-sectors and 83% of its constituents were also in the black.

The index remains just above the lows hit after the Omicron breakout last month and volatility (.V2TX) is near recent highs, and above 30 points, suggesting investors remain wary of the risks linked to the new virus variant.

The oil (.SXEP) sector was the stand-out gainer, up 1.6% in early trading to its highest in over 1 week, as crude rose after top exporter Saudi Arabia raised prices for its crude.

Here’s you opening snapshot:

(Danilo Masoni)

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CHASING THE OMICRON DIP (0758 GMT)

Buying the dip triggered by the Omicron COVID-19 variant across global markets has proven a costly strategy so far. But some investors seem determined to have another go.

European and U.S. stocks futures are trading sharply higher after ending last week on a sour note and notwithstanding a dismal day in Asia where an MSCI index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) lost about 0.9%.

The region has seen a series of corporate setbacks after ride-hailing giant Didi (DIDI.N) decided to withdraw from the New York stock exchange last week.

Shares in China Evergrande (3333.HK), the world’s most indebted developer, plunged 14% after it said there was no guarantee it would have enough funds to meet debt repayments.

Another giant, Alibaba (9988.HK) dropped 5% after announcing it would reorganise its international and domestic e-commerce businesses. And U.S. regulatory opposition to the sale of Softbank-owned chip firm Arm pushed the Japanese conglomerate 8% lower (9984.T) read more .

But the mood is lighter already across Europe, allowing 10-year Treasury yields to claw back some of Friday’s falls which took them below 1.4% for the first time since late September.

There are five trading sessions left before Friday’s U.S. consumer price report which some reckon will provide the green light for the Federal Reserve to accelerate its tapering of bond purchases.

Oil prices too rose by more than $1 a barrel after Saudi Arabia raised prices for its crude sold to Asia and the United States read more .

And if the market mood is perking up, there is no sign of that in Bitcoin which has fallen further and is now at $48,244 — some $20,000 below peaks hit a month ago.

Key developments that should provide more direction to markets on Monday:

-Vivendi is open to discuss with Rome over state control on TIM’s network read more

-Alibaba overhauls e-commerce businesses, names new CFO read more

-Swiss National Bank Vice Chairman Zurbruegg to retire in July 2022 read more

-Weaker foreign demand sinks German industrial orders in October read more

-CBI cuts UK economic growth forecasts on supply chain hit read more

-Euro zone finance ministers to discuss 2022 draft budgets, euro summit

– Russian President Vladimir Putin visits India

– UK construction PMI/new car sales

– Euro zone finance ministers to discuss 2022 draft budgets, euro summit BOE deputy Governor Broadbent, ECB Governor Lagarde and board member Panetta speak

(Julien Ponthus)

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EUROPE: UP WE GO (0734 GMT)

European shares look set for a bounce back today with stock futures decisively pointing north following a volatile week dominated by jitters over Omicron and the Fed’s policy outlook.

Futures on the Euro STOXX 50 index were last up around 1%, while U.S. derivatives also pointed to a recovery later on Wall Street after Friday’s late slide.

Asian shares lagged, even as Japan considered raising its growth forecast and Chinese Premier Li Keqiang was reported as saying Beijing will cut reserve ratios for banks. read more

(Danilo Masoni)

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