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Business news: Omicron fears subside, UK inflation rises

By Jenny McCall

11:43, 4 January 2022

A aerial view of Carnival Cruise ship Magic as it departs Miami.
Aerial view of Carnival Cruise ship Magic as it departs Miami – Photo: Shutterstock

Key points

  • Inflation rises: The New Year welcomed in some unsurprising news from the British Retail Consortium (BRC), which confirmed that inflation was up in the month of December. UK shoppers dealt with significant price inflation, which increased from 0.3% in November to 0.8%. On average, prices have decreased by 0.9% over the last 12 months.
  • Airline boom: The airline industry received good news as stocks surged on the London Stock Exchange. Signs that Omicron cases are now declining led to low-cost carriers such as Wizz Air (WIZZ) and easyJet (EZJ) stock up by 9.96% and 7.34% respectively, along with cruise operator Carnival (CCL), which was up 7.7% in the first hour of trading.

Business and economic news

  • Apple (APPL) became the first company to hit a $3trn stock market value. Investors believe the technology company will keep launching high-profile, best-selling products, as it looks to launch into automated cars and virtual reality.
  • Stock prices for the Japanese automobile company Toyota Motor closed over 6% higher today, as media reports emerged that the company would launch its own automotive software platform by 2025. The stock saw its best day in nearly two years.

Markets today

  • Stocks: The FTSE 100 reached an almost two-year high today in the first day of trading for the New Year. Investors are banking on the Omicron variant dying down and expect cases to start declining. Australian and Japanese stock markets also opened on a high today, rising over 1% each, on the back Wall Street closing at record highs overnight.
  • Oil: Oil prices were steady today as investors expected major producers to stay with their planned output increase, amid decreasing concerns over the spread of the Omicron variant. Brent crude was up 0.3%, at $79.20 a barrel at 0939 GMT, while U.S. West Texas Intermediate (WTI) crude rose by 0.3%, to $76.29 a barrel.
  • Gold: Gold prices gained on Tuesday amid curbs to contain the spread of Omicron coronavirus cases. Spot gold rose 0.3% to $1,806.20 per ounce by 0109 GMT.
  • Forex: The Turkish lira fell by 4% against the dollar today as Turkey braced itself for inflation to rise higher after touching a 19-year peak.
  • Crypto: Bitcoin (BTC) was down 1.34% today and Ethereum (ETH) was up 0.09% today in mid-morning trading.

What to watch today

  • Germany saw employment improve in November 2021, however data from Federal Statistical Office (Destatis) shows that it was still below pre-pandemic levels.
  • The World Health Organisation (WHO) has reported today that the Omicron variant produces milder symptoms than previous variants such as Delta.
  • More evidence is emerging that the Omicron coronavirus variant is affecting the upper respiratory tract, causing milder symptoms than previous variants, a World Health Organization official said on Tuesday.

Read more: UK retail price inflation up in December, set to rise further

Markets in this article

CCL
Carnival Corp (Extended Hours)
18.25 USD
0.11 +0.610%
EZJgb
EasyJet
4.98 USD
0.01 +0.200%
WIZZ
Wizz Air
21.81 USD
-0.1 -0.460%
WIZZ
Wizz Air
21.81 USD
-0.1 -0.460%

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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