European Shares Mixed, Asia Slips on Omicron Worries

A man wearing a protective mask looks at an electronic stock board showing Japan's Nikkei 225 and Shanghai indexes at a securities firm with a traditional New Year decoration at its entrance in Tokyo, Japan, on Dec. 29, 2021. (Eugene Hoshiko/AP Photo)

TOKYO—European benchmarks opened mixed, with London’s FTSE 100 at nearly a two-year high, after Asian shares mostly finished lower Wednesday.

France’s CAC 40 edged up 0.1 percent in early trading to 7,190.22, while Germany’s DAX slipped 0.2 percent to 15,935.45. Britain’s FTSE 100 rose 1.1 percent to 7,449.16—its highest level since February 2020, amid optimism that the omicron coronavirus variant may prove to be milder than earlier versions of the virus.

U.S. shares were set to drift higher with Dow futures gaining 0.1 percent to 36,329.00. S&P 500 futures rose 0.2 percent to 4,788.25.

In Asian trading, Japan’s benchmark Nikkei 225 lost 0.6 percent to finish at 28,906.88. South Korea’s Kospi slipped 0.9 percent to 2,993.29, while Australia’s S&P/ASX 200 jumped 1.2 percent to 7,509.80. Hong Kong’s Hang Seng dropped 0.8 percent to 23,086.54, and the Shanghai Composite shed 0.9 percent to 3,597.00.

Although Asia has relatively few reported infection cases of the omicron variant compared to the U.S. and Europe, fears are growing that omicron will spread quickly once it gets going.

“The wider point is that regardless of how ‘variant risks’ play out, the process of emerging from the COVID tunnel will be fraught with more heat than light,” meaning problems such as “impediments to unfettered global travel,” which will hobble any recovery, Vishnu Varathan of Mizuho Bank said in a report.

Much is still uncertain about omicron, which is spreading extremely quickly and leading to a return to pandemic restrictions in some places. The variant is quickly becoming the dominant strain throughout the world.

While virus-related lockdowns and travel restrictions remain a big concern, most big investors have closed out their positions for 2021 and are likely to hold their ground until next week.

In energy trading, benchmark U.S. crude gained 18 cents to $76.16 a barrel from $75.98. Brent crude, the international standard, added 28 cents to $79.22 a barrel.

In currency trading, the U.S. dollar rose to 114.97 Japanese yen from 114.81 yen. The euro cost $1.1279, down from $1.1310.

By Yuri Kageyama