Month: December 2021

As Europe rang in the New Year 20 years ago, 12 of its nations said goodbye to their deutschmarks, French francs, liras and pesetas as they welcomed the euro single currency.

On January 1, 2002, euro notes and coins became a reality for some 300 million people from Athens to Dublin, three years after the currency was formally launched in “virtual” form.

Here is a recap of the event, drawn from AFP reporting at the time:

In a far cry from the austere New Year’s celebrations imposed by the COVID-19 pandemic 20 years later, fireworks, music and lights blazed at midnight into the early morning of January 1, 2002, to mark the biggest monetary switch in history.

AFP reported that many people passed on their traditional New Year’s Eve parties, choosing instead to queue up at cash dispensers in their enthusiasm to get hold of the first pristine euro notes.

In Berlin, Germans said hello to the euro and goodbye to their beloved mark at a special ceremony at the Brandenburg Gate, as up to 1 million people thronged the streets for the traditional giant New Year’s Eve street party there.

The euro cash was also a hit in the coffee shops and red-light district of Amsterdam.

Irish revelers were, however, less in a hurry to welcome the euro, continuing to pay for Guinness, Ireland’s favorite tipple, in the national currency, leaving the headache of the changeover until the next day.

As many feared, the euro switch provoked sporadic price hikes across Europe.

From Spanish bus tickets, which jumped by 33%, to a Finnish bazaar, where “everything for 10 markka (1.68 euros)” was now “everything for two euros,” many price tags were a bit heftier since the single currency became legal tender.

The European Central Bank president at the time, Wim Duisenberg, who warned merchants not to take advantage of the euro launch to increase prices, said he had not seen signs of widespread abuse.

“When I bought a Big Mac and a strawberry milkshake this week it cost 4.45 euros, which is exactly the same amount as I paid for the same meal last week,” Duisenberg told reporters.

Europe surprised itself with the almost glitch-free transition to the single currency, AFP reported.

The Germans — reputedly skeptical about the single currency and nostalgic for their mark — turned out to be among the most enthusiastic.

An editorial in the popular German tabloid Bild proclaimed: “Our new money is moving full speed ahead. No problems whatsoever in saying adieu to the mark, no tears to be shed.”

Initial “europhoria” was, however, tempered as a few hiccups appeared, such as cash shortages and long lines in banks, post offices and at toll booths.

France urged citizens to not rush all at once to the banks with their savings, often hoarded under mattresses and in jam jars, since they had until June 30 to get rid of their francs at commercial banks and until 2012 at the Bank of France.

And the European Commission reported minor problems in getting small euro bills and coins distributed in most countries.

Duisenberg said, however, he was sure that January 1, 2002, would be written into history books as the start of a new European era.

Source: Voice of America

Researchers in South Africa have discovered that people who have been infected with the omicron variant of the coronavirus develop enhanced immunity to the older delta variant.

The conclusion is the result of a new study conducted at Durban-based Africa Health Research Institute involving 33 vaccinated and unvaccinated people. The scientists found that immunity against a further exposure to omicron rose 14-fold about two weeks after infection, while also discovering that immunity against delta improved 4.4-fold.

The scientists say the immunity is especially enhanced among those who are inoculated.

Alex Sigal, the study’s co-author, said on Twitter Monday that if omicron is “less pathogenic” as it appears, “then this will help push delta out,” making it possible

“the disruption Covid-19 has caused in our lives may become less.”

The study, which has not been peer reviewed, has been submitted to the medical journal MedRxiv.

An earlier study out of South Africa revealed a reduced risk of hospitalization and severe illness from omicron, compared to delta.

The omicron strain has rapidly spread around the world since it was first detected in southern Africa in November.

Source: Voice of America

Holiday travelers continued to experience widespread flight cancellations as the omicron variant causes airline staff to call in sick.

According to FlightAware, which tracks delays and cancellations, there have been 2,395 total flight cancellations around the world Monday with 869 of those impacting flights “within, into, or out of the United States.”

Some 6,342 flights have been delayed around the world with 1,602 delays impacting U.S flights.

Over the Christmas weekend, thousands more flights were canceled, leaving travelers stranded.

“We apologize to our customers for the delay in their holiday travel plans,” Delta said in a statement. “Delta people are working hard to get them to where they need to be as quickly and as safely as possible on the next available flight.”

The holiday season is the busiest time of year for air travel. The U.S. Transportation Security Administration said 2.19 million passengers were screened on Dec. 23, and the previous day saw more travelers than the same day in 2019.

When things might return to normal is unclear.

Delta and JetBlue have reportedly asked the U.S. Centers for Disease Control and Prevention to reduce quarantine times for their vaccinated employees. Some airlines are also reportedly offering bonuses to work more to cover for sick employees.

Amid the scramble, some are expressing concern.

“We’ve got to make sure employees don’t feel pressured to come to work when they’ve been exposed to COVID or they think they may have the symptoms,” Captain Dennis Tajer, a spokesperson for the Allied Pilots Association, told ABC News.

Source: Voice of America

Doctors in Israel began administering a fourth dose of the COVID-19 vaccine Monday as part of a trial study to determine if the extra shot can boost immunity against the virus.

The trial study involving about 150 staffers at Sheba Medical Center near Tel Aviv comes just days after a special health advisory panel recommended that people 60 years old and older, as well as those with compromised immune systems and medical workers, receive a fourth dose of the Pfizer vaccine.Health Ministry Director Nachman Ash must give final approval to the panel’s recommendation.

Israel has outpaced much of the world in vaccinating its citizens, including offering booster shots, but the pace has slowed in recent weeks as it faces a fifth wave of new COVID-19 infections driven by the omicron variant of the coronavirus.

The fast-spreading variant has led to chaotic closures and cancellations around the world since it was first identified last month in a handful of southern African nations.

Thousands of flights in the United States and around the world were cancelled as flight crews called in sick after testing positive for COVID-19, leaving passengers stranded and unable to join family and friends during the Christmas holiday weekend.

Impact on sports events

In U.S. college football, two post-season “bowl” games scheduled this week are the latest to be cancelled due to a large outbreak of COVID-19 infections among players. Boston College was forced to withdraw from Monday’s contest against East Carolina in the Military Bowl inAnnapolis, Maryland, while the University of Virginia pulled out of its matchup against Southern Methodist University Wednesday in the Fenway Bowl, which was to be staged at the iconic home of Major League Baseball’s Boston Red Sox. The two programs join the University of Hawaii, Texas A&M and Miami to withdraw from their respective bowl games because of a high rate of infections that left them without enough players available for the game, which will cost the programs hundreds of thousands of dollars for failing to participate.

New restrictions in France

Elsewhere in the world, French President Emmanuel Macron is expected to announce a new set of COVID-19 related restrictions Monday after holding an emergency meeting with his Cabinet.

The new measures come as France posted a new single-day record of100,000 new coronavirus cases on Saturday.Among the expected new measures is limiting France’s health passport, which is required to enter restaurants and other indoor public venues, only to those who have been fully vaccinated.

China

And authorities in the northern Chinese city of Xi’an have tightened its strict lockdown of the city of 13 million residents as it continues to battle a spike in new COVID-19 cases. The new rules announced Monday bans residents from driving even within city limits unless for work or taking part in virus control work, with violators facing 10 days in detention and up to $78 in fines. Residents are already banned from leaving their homes unless they have essential jobs.

Xi’an, the home of the world-famous Terracotta Warriors, recorded 150 new cases for Sunday, bringing its total number of new infections since December 9 to well over 600, although it is not known if the surge is being driven by omicron or the previous delta variant.

Source: Voice of America

U.S. airlines called off hundreds of flights for a third day in a row on Sunday as surging COVID-19 infections due to the highly transmissible Omicron variant grounded crews and forced tens of thousands of Christmas weekend travelers to change their plans.

Commercial airlines canceled 656 flights within, into or out of the United States on Sunday, slightly down from nearly 1,000 from Christmas Day and nearly 700 on Christmas Eve, according to a tally on flight-tracking website FlightAware.com.

Further cancellations were likely, and more than 920 flights were delayed.

The Christmas holidays are typically a peak time for air travel, but the rapid spread of the Omicron variant has led to a sharp increase in COVID-19 infections, forcing airlines to cancel flights with pilots and crew needing to be quarantined.

Delta Air Lines Inc expected more than 300 of its flights to be canceled on Sunday.

“Winter weather in portions of the U.S. and the Omicron variant continued to impact Delta’s holiday weekend flight schedule,” a Delta spokesperson said in an emailed statement, adding that the company was working to “reroute and substitute aircraft and crews to get customers where they need to be as quickly and safely as possible.”

When that was not possible, it was coordinating with impacted customers on the next available flight, the spokesperson said.

Globally, FlightAware data showed that nearly 2,150 flights were called off on Sunday and another 5,798 were delayed, as of 9.40 a.m. EST (1440 GMT).

Omicron was first detected in November and now accounts for nearly three-quarters of U.S. cases and as many as 90% in some areas, such as the Eastern Seaboard. The average number of new U.S. coronavirus cases has risen 45% to 179,000 per day over the past week, according to a Reuters tally.

While recent research suggests Omicron produces milder illness and a lower rate of hospitalizations than previous variants of COVID-19, health officials have maintained a cautious note about the outlook.

Source: Voice of America

Investors are closely watching the latest news on the rapidly spreading Omicron variant for signs of how much the virus could impact the U.S. economy and earnings as the market heads into what has historically been a strong time of year for equities.

Overall, the S&P 500 is slightly ahead since Nov. 24, prior to news of the variant hitting markets. It marked a record-high close on Thursday, as encouraging developments gave investors more ease about the economic impact of the variant.

“The market is extremely reactionary now and every little bit of news has a huge impact,” said George Young, a portfolio manager at Villere & Co. Young is planning on taking advantage of any Omicron-induced volatility to add to stocks that rely on tourism and travel such as bank company First Hawaiian Inc . Shares of the company are up 14.4% for the year to date.

The Omicron variant is causing infections to double in 1.5 to 3 days, according to the World Health Organization. The variant now accounts for 73% of all new U.S. cases, up from less than 1% at the beginning of the month.

Still, questions about Omicron’s virulence have made investors less pessimistic than the original reaction. The S&P 500 closed down 2.3% on Nov. 26 after the variant was discovered, on fears of fresh economic lockdowns.

A South African study offered hope about the severity of Omicron and the trend of COVID-19 infections on Wednesday. Shares of vaccine makers slumped in December as investors expect the Omicron variant’s impact to be limited based on recent data.

That bodes well for what is known in the market as a Santa Claus rally. Historically, U.S. stocks have risen during the last five trading days of December and the first two days of January in 56 out of 75 years since 1945, according to data from CFRA Research. This year, the time period starts on Dec. 27. The average Santa Claus rally has boosted the S&P 500 by 1.3% since 1969, according to the Stock Trader’s Almanac.

It is unclear to what extent Wall Street analysts expect Omicron to affect earnings and the economy. Estimated 2022 S&P 500 earnings growth was at 8.3% as of Friday, compared with 8.0% at the start of December, according to Refinitiv data.

Goldman Sachs cut its estimate for U.S. GDP growth to 3.8% from 4.2% due to the uncertainty of the impact of the Omicron wave.

Possible Volatility

While there will likely be some economic impact from Omicron, U.S. consumer spending will likely remain strong, said Cliff Hodge, chief investment officer for Cornerstone Wealth.

He is focused on any signs that Senator Joe Manchin could reach an agreement to support President Joe Biden’s signature $1.75 trillion Build Back Better climate and social spending bill. Manchin, who would provide one of the key votes to pass the bill in a divided Senate, said on Sunday that he could not support the bill in its current form. Senate Majority Leader Chuck Schumer said that the Senate will vote on the bill in early January.

“We need a little bit of good news whether on the Manchin front or Omicron to get a rally going,” Hodge said. “We are fully invested and anticipate a little bit of a relief rally into January.”

The week ahead will be light on economic data, with the release of the S&P Case-Shiller U.S. home price index on Tuesday among the few notable data points.

The lack of new reads of the strength of the economy at a time when coronavirus case counts are rising may leave the stock market more volatile through the end of the year, said Dana D’Auria, co-chief investment officer of Envestnet PMC.

“The market has gotten pretty good at pricing in and leading off from what we are learning about on the health side,” she said.

Should Omicron cases continue to spike or there are signs that economic restrictions could be reimposed, investors will likely rebalance into the shares of giant technology companies such as Apple Inc that have emerged as defensive plays given their large cash positions and revenue growth as a result of remote work, D’Auria said.

“At the end of the day if Omicron really causes problems I would be ready for a more volatile market” well into the new year, she said.

Source: Voice of America