Geoffrey Smith 

Investing.com — The signs Omicron might not be so big are helping global markets to rebound. ADP’s private payroll survey is out and the Institute of Supply Management provides the latest updates on its manufacturing survey. China’s factories are slipping back into contraction. After a disappointing update, Salesforce has been under severe pressure and David Marcus (the crypto expert at Meta) is leaving. After a remarkable rout, oil makes an impressive recovery ahead of the eagerly-awaited OPEC+ conference. This is what you should know about financial markets Wednesday 1st of December.

1. International markets are booming

Global markets returned, cautiously, to risk-on mode, digesting Federal Reserve Chairman Jerome Powell’s hawkish turn in Congress on Tuesday and daring to hope that the new Omicron variant of Covid-19 may yet turn out to be not the dramatic new bearish development that many fear.

The exchange rate was below 96 by 6:15 am ET (1115 GMT), with the largest losses being against higher-yielding currencies and not against havens. The yield on the interest rate sensitive two-year Treasury bond had meanwhile settled into a range around 0.61%, still some eight basis points off last week’s peak.

Israel’s Health Minister said overnight that those with three doses of the Pfizer/BioNTech vaccine appeared to have adequate immune defense against Omicron, adding to suggestions that the new strain can be coped with by existing medicine. Also conspicuous is the failure – so far – of its spread in South Africa to lead to any notable spike in deaths or serious illness.

2. ADP, ISM, and a Powell reprise 

Fed Chair Powell has been forced to accept that inflation is increasing faster than expected. This will make it all the more important for Americans to watch and pay attention to U.S. data. Powell, meanwhile will give the House of Representatives a repeat of his testimony.

The most important number will likely be ADP’s private payrolls survey for November, the traditional warm-up act for the government’s labor market report on Friday. Analysts predict that the economy added 525,000 more jobs in November, a slight decrease from October’s 571,000.

Also due are the Institute of Supply Management’s purchasing managers index for November at 10 AM ET. Similar surveys by Caixin and IHSMarkit showed that Chinese manufacturing activity fell back into contraction overnight, with a slight improvement in Europe’s supply chain situation.

3. Stocks to Open Higher; Salesforce fails

Although the U.S. stock exchanges are expected to open higher on Monday, it is less than the previous drop. Powell’s comments, while widely anticipated and actively encouraged by many voices in the market, still represent a milestone in the policy response to the pandemic that accelerates the withdrawal of the market’s biggest supporting factor for the last 20 months.

They were up 0.8% or 285 points by 6:20 ET. Nasdaq futures was up 1.4% and were up 1.2% at the same time. These three indices were down 1.9%, 1.9%, and 1.6% on Tuesday.

Salesforce (NYSE:) is likely to come under scrutiny later. Its guidance for this quarter fell significantly below the street’s expectations when it released its results Tuesday. Meta (NASDAQ:) will also be under scrutiny after David Marcus, the virtual currency project’s leader, resigned.  Earnings will be announced by all companies after close: Synopsis and Crowdstrike as well as Okta (NASDAQ;), Splunk, PVH (NYSEH) and Splunk.

4. Bye-bye, VIE?

According to Bloomberg, China will close the loophole which allowed many mainland Chinese businesses to list in America without having to first be listed domestically.

The move has been widely predicted, as an inevitable logical conclusion to the security-related concerns flagged by the regulators in their clampdown on the country’s tech giants earlier in the year.

Beijing’s regulators asked Didi Global to resign from the New York Stock Exchange. Didi Global had refused their request to halt the listing until a security review was complete. Bloomberg said it isn’t clear whether other companies would be forced to delist under the planned regulations, which are still being worked out.

Alibaba (NYSE:). Many others used an entity called a Variable Income Entity to list in New York over the past couple decades. It is a foreign-registered vehicle.

5. Oil rises in response to OPEC speculation

Oil prices have rebounded on the rumours that OPEC and its partner (not surprisingly Russia) may halt their monthly series of production increases to stem the market’s tendency towards a return to surplus.

Thursday’s meeting of the “OPEC+” bloc’s ministers will determine January output levels. OPEC’s Tuesday data showed that for the third straight month, the cartel was unable to adjust its output levels in accordance with the quota adjustment. This is a decrease of around 30,000 barrels per daily.

Futures rose 4.4% to $69.06 per barrel at 6:30 am, a recovery from oversold levels. However, they were down 4.6% to $72.43 per barrel by the time of 6:33 AM. U.S. government data about crude inventories is due at 10:30 am ET. It comes after the American Petroleum Institute announced a less significant draw than expected.