Peter Nurse 

Investing.com – European stock markets are expected to open sharply lower Monday as countries react to surging Omicron-variant Covid-19 cases with tighter mobility restrictions, potentially damaging the region’s economic recovery.

At 2 AM ET (0700 GMT), Germany’s contract traded at 2% less, France saw a 1.7% drop and Britain saw a 1.2% decline.

The Netherlands was in lockdown Sunday with everything except essential closed till at least January 14. This led to other European countries.

Sajid Javid was the U.K. Health Minister and he refused Sunday to dismiss the possibility of additional restrictions being imposed before Christmas. Following the rapid spread and declaration by the London Mayor, this is a significant incident. Although deaths in the U.K. are increasing, hospital admissions remain within recent levels.

Local newspapers in Italy reported Sunday that the government was considering new ways to prevent an increase in infection during holidays.

On Saturday, the World Health Organization stated that Omicron-related cases have increased by 1.5-3 days in communities. But, it noted that there are still many unknowns about the disease, and the extent of its effects. 

The plus side is that the prime rate for one year was cut Monday, the first since April 2020. This boosts support for the troubled real-estate sector.

BNP Paribas, OTC: (corporate news) will be the topic Monday. This is after Wall Street Journal reports that Canada’s Bank of Montreal has begun talks to acquire the U.S. affiliate of the French bank. According to reports, the agreement could be made as early as next week. It would potentially value the unit at approximately $15 billion.

In a week that was short on holidays, the economic data slate remains largely unfilled Monday. Only current account data from the Eurozone is due to be released.

The rapid increase in Omicron Covid-19 cases raised concern that restrictions placed by a few countries on travel might last for some time and impact oil prices. 

The futures closed 3.8% below $68.17 per barrel at 2AM ET. However, the contract dropped 3.2% to $71.19. 

Also, it fell 0.2% to $1.801.75/oz. However, it was 0.1% less at 1.1250.