News of a SARS-CoV-2 variant potentially resistant to current vaccines sent investors dashing for the safety of the Japanese yen and the Swiss franc on Friday, and traders also took profits after an extended rally in the US dollar.
The gains in the yen and the Swiss franc came at the expense of the growth-sensitive Australian dollar and Norwegian krone, although thinner volumes after Thursday’s US Thanksgiving holiday made market moves more volatile.
The US is to restrict travel from South Africa — where the new mutation was discovered — and neighboring countries beginning tomorrow, a senior official from the administration of US President Joe Biden said.
The WHO said it was designating the variant, named Omicron, as “variant of concern,” a label applied only to four variants to date. It could take weeks for scientists to fully understand the variant’s mutations and potential dangers.
“If we’re looking at something like this where we have new mutations on mutations of a spike protein it almost feels like the initial working assumption for most market participants is that this is a new phase of the pandemic,” said Bipan Rai, North American head of FX strategy at CIBC Capital Markets in Toronto.
“New lockdowns and restrictions will maybe be put in place, and it certainly feels like we’re going to need a new vaccine as well,” he added.
One of the main gainers was the yen, which bounced off five-year lows hit this week against the greenback, and jumped almost 2 percent to a high of ￥113.09, its best day since March last year.
The euro rose 0.97 percent to a high of US$1.1312, although it fell to more than six-year lows against the resurgent Swiss franc, at SF1.0428 per euro.
“This is a textbook flight to quality into yen and the Swiss franc on the new virus strain, with the thin liquidity also a factor, which may accelerate the unwinding of short bond positions,” Kenneth Broux, a strategist at Societe Generale SA in London, said.
Speculative accounts had been massively short safe-haven assets, with US CFTC figures showing net bearish positioning at US$1.2 billion and US$10.3 billion for the yen and Swiss franc respectively in the latest week.
In Taipei, the New Taiwan dollar on Friday fell against the US dollar, losing NT$0.035 to close at NT$27.836, down 0.15 percent weekly.
The US dollar index on Friday dipped 0.75 percent to 96.030, after reaching a 16-month high of 96.938 on Wednesday. The index is unchanged for the week.
It has jumped from 93.872 on Nov. 9 as investors increased bets that the US Federal Reserve will begin raising interest rates in mid-2022 to thwart stubbornly high inflation.
Sterling briefly slipped to a new low for this year below US$1.3278 as the jitters prompted some to scale back bets on an interest rate hike next month.
In the cryptocurrency market, bitcoin fell to as low as US$53,524, the lowest since Oct. 10, while ethereum dropped to US$3,917, the lowest since Oct. 28.
Additional reporting by CNA, with staff writer
MediaTek Inc (聯發科), the world’s biggest 5G chip supplier, saw its ranking rise by one notch to No. 7 last year among world semiconductor vendors, as it benefited from the rapid 5G smartphone uptake in China after Huawei Technologies Co (華為) was forced to exit the market, Gartner Inc said in a report yesterday. MediaTek’s revenue soared 58.8 percent to US$17.45 billion last year from US$10.99 billion in 2020, outpacing the global semiconductor industry’s growth of 25 percent, according to Gartner’s tally. That gave MediaTek a 3 percent market share. The Hsinchu-based chip company ranked No. 8 in 2020, behind Texas Instruments
Medigen Vaccine Biologics Corp (高端疫苗) yesterday reported higher neutralizing antibody levels in people who were given its COVID-19 vaccine as a booster after two AstraZeneca doses, the company said. In a trial of 200 participants who received Medigen’s COVID-19 vaccine, neutralizing antibodies against the Omicron variant of SARS-CoV-2 grew by 5.7 times one month after being administered, Taoyuan General Hospital said. Medigen said that the results have been submitted to medRxiv, an online platform for researchers to share complete but unpublished papers. Another trial conducted by National Taiwan University Hospital showed that among 45 participants who received three doses of the Medigen vaccine,
BEATING EXPECTATIONS: With electric vehicles and the metaverse on the horizon, the company predicts a solid first quarter as customers stockpile inventories Key iPhone assembler Hon Hai Precision Industry Co (鴻海精密) could achieve an “unprecedented” performance in the first quarter, chairman Young Liu (劉揚偉) said. “Our performance in the first quarter might surpass how we fared in the past few years, and it is likely that some staff at key sites might only get two days off during the Lunar New Year holiday,” Liu said in prepared remarks for the company’s annual workers’ party yesterday. Manufacturers around the world are racing to build up inventory out of fear that outbreaks of the Omicron variant of SARS-CoV-2 and other uncertainties could further disrupt their supply
Jardine Matheson Holdings Ltd (怡和洋行), a diversified Asia-based group whose businesses span property, transport, retail and luxury hotels, is considering strategic options for its restaurant unit, people with knowledge of the matter said. The Singapore-traded conglomerate is weighing a sale of Jardine Restaurant Group (怡和餐飲集團), a wholly owned subsidiary that operates KFC and Pizza Hut franchises in Taiwan, Hong Kong, Macau and Vietnam, said the people, who asked not to be identified as the information is private. The subsidiary also runs Pizza Hut restaurants in Myanmar, according to its Web site. Jardine Matheson has held preliminary discussions with advisers, the people said, adding
RSS