By Daniel Shvartsman

Markets appear to be starting 2022 as they did in 2021. They are likely to go even higher. In Q4, Tesla (NASDAQ:), and other electric cars saw strong momentum. The cancellations continue to be a problem for airlines. The calendar has been flipped one year in advance, but have things changed? This is what you should be watching in the financial markets Monday, January 3, 2022.

1. Expect Electric Vehicle Deliveries to Be Hot. Strong Auto Demand

Tesla finished 2022 in a record breaking beat for Q4 deliveries, beating analyst expectations of 263,026. Shares are trading up 7.2% as of 730am ET (1230 GMT) on what Wedbush analyst and Tesla bull Daniel Ives called a “jaw dropping” delivery number that ,”speaks to an EV demand trajectory that looks robust for Tesla heading into 2022.”

Not just Tesla saw significant increases in Q4 delivery. Chinese electric vehicle manufacturers Nio (NYSE;), Li Auto (NASDAQ::), and Xpeng(NYSE:) saw substantial growths. Nio’s delivered 44% more vehicles than the previous record, while Li Auto saw a 143% increase to 35,221 vehicles. XPeng experienced the largest rise with a 222% increase to 41,751 units. Both of these companies trade 2+% higher pre-market.

Apart from EVs and auto stocks, trading is taking place in the U.S. pre-market. A trigger could be an from Hyundai Motor (KS) For 12.1% Growth in 2022. This is encouraging considering all the challenges that the industry faced in supply chain, which also affected the used car market. Is this a sign that things are getting back on track? It’s too early to know, but the investors like this news.

2. Futures Pointing Higher

Each of the major U.S. Indices finished 2021 in positive territory with gains of 20% or more. It is therefore not surprising that U.S. futures begin the new year in the green. They are currently up 172 points, or.47% at 730 AM ET. However, they are up by.55%. Tesla’s impulsiveness has pushed them up by.7%.

For some historical context, the last time the S&P 500 gained more than 25% in a year, it followed up with 16% growth; of course, that was in 2019 and 2020This is a rare period. The previous example was 2013 and 2014, where the S&P 500 finished up 29.6% and then 11.3%, respectively.

2012-2014 was also the previous three-year stretch where the S&P 500 finished in the green, and higher by 10%+ in each year, before this 2019-2021 period. What was the response? What was the response?

The two years of the pandemic, as well as the response by central banks and governments to it, felt unprecedented. However there are many parallels that can be found. It remains to be determined if history will continue, rhyme or faintly echo.

3. Airlines are still on Watch

The airlines’ problems have come to light amid quiet trading and weak news during the holiday season. FlightAware.com reported that yesterday there were more than 2700 cancellations for flights to, from, or within the United States. Another 1800+ have occurred today.

European trading sessions offer reason to be optimistic for the industry as a jet engine manufacturer Safran (PA:). To hire 12,000 workers as their CEO stated that he believes demand will recover. He also said that he is confident that “the worst” is over. European aircraft industry names and airlines are moving higher. The U.S. has two major players: Delta Air Lines Inc (NYSE) and American Airlines (NASDAQ) are up by.7% in pre-market trades.

The December traffic report will be published by the airlines this week. This will offer a final look on disruptions over the past year as well as a preview to earnings reports. Delta will begin reporting next Thursday.

4. Pre-OPEC JOlt for Oil

As Libya’s pipeline continues to fail, prices are rising by.4% and.6%. Meeting of Organization of Petroleum Exporting Countries (OPEC), tomorrow. They are expected to maintain the planned moderate production rise, consistent with their belief that demand will continue recovering through 2022 at pre-pandemic levels.

5. PMI-Promising Manufacturing Indicators

The Eurozone, along with several European countries, released December Purchasing Manager Indice reports. These indicators indicate that December saw manufacturing expansion. The majority of numbers were in line with analysts’ expectations. In fact, the Eurozone was right at 58 according to the forecasts of analysts. Anything above 50 is considered expansion. The preliminary data released in December was consistent with this release.

The 2022 year is expected to see monetary tightening in an effort to fight inflation. It remains to be seen if central banks are able to pull that off without affecting the recovery of the world economy from the pandemic. The mix is still dominated by confounding variables like the resurgence in Covid case count and its subsequent economic, and health effects. Continued economic expansion in Europe even when many European countries experienced new highs last month in Covid cases is encouraging. It could indicate that Covid is becoming a less severe variant, or that people can live with it.

In spite of all this, the market is still trading at below flat levels, down 0.15% at 8:30 AM ET.