nov 29  welcome to the home for realtime coverage of markets brought to you by reuters reporters you can share your thoughts with us at marketsresearchthomsonreuterscom us semiconductor stocks are surging on monday following last fridays coronavirusdriven selloff with the main chip index less than 1 away from its previous record closing high chip stocks spearheaded a broad tech rally as investors secondguessed last fridays over2 drop in the nasdaq ixic and awaited more information an the omicron coronavirus variant the philadelphia semiconductor index sox was last up 35 more than making up for its nearly 3 drop on friday the sox is down about 05 from its record high close on nov 19 nvidia nvdao and qualcomm qcomo both jumped over 4 and lifted the sox index more than any other companies memory chip maker micron technology muo jumped 25 after digitimes reported in a story citing industry sources that ddr3 memory chip prices would likely recover in early 2022 with mondays bounce back the chip index is now up 39 in 2021 news of the omicron covid19 variant sent markets into a tailspin on friday to the tune of a 23 drop in the sp 500 spx a 37 fall in the small cap russell 2000 rut oil prices down about 10 and the yield on the 10year us treasury note declining as low as 147 according to jonathan golub chief us equity strategist at credit suisse investors had been treating pandemic concerns with less weight than inflation stock valuations central bank policy and china growth prior to fridays news and while investors may pause on making investment decisions until they have greater clarity on omicron golub notes about spikes in volatility such as on friday when the cboe volatility index vix jumped about 10 points to 286 that equity returns tend to be twice as rich during periods of heightened volatility with small caps leading the charge when the vix is greater than 15 the subsequent 2 months return is 29 for the sp 500 and 35 for the russell 2000 according to golub that jumps to 51 and 67 respectively when the vix is greater than 20 and rises to 64 for the sp 500 and 84 for the russell when the volatility index is greater than 25 oil capacity shocks could mean 150 a barrel by 2023 – jpmorgan oil producers are likely to have capacity shocks in the coming two years that could see oil prices jump to 125 a barrel in 2022 and 150 a barrel in 2023 according to analysts at jpmorgan brent crude prices have eased since hitting a threeyear high of 8670 a barrel on oct 25 though prices remain relatively elevated at 7614 a barrel jpmorgan sees the problem getting worse due to underinvestment in the sector over the past 18 months the bank expects that opec’s spare capacity will be around 2 million barrels a day in 2022 which is 43 below consensus estimates of 48 million barrels a day and sees the group’s total capacity shortfall extending to 3 million barrels a day by the first half of 2024 compared to opec’s target of 491 million barrels a day in that time frame opec “has returned to a position of positive leverage which it will defend by keeping inventories low the market in balance and taking action to support optimal reservoir management through paced volume growth” the analysts said longerterm oil prices of 80 a barrel is likely needed to spur the investment needed to increase capacity as demand grows and oil is likely to trade around this price from 2024 jpmorgan said in the interim however prices are expected to rise to 90 a barrel in 2022 and 104 a barrel in 2023 with overshoots to 125 a barrel in 2022 and 150 a barrel in 2023 likely the bank said glass half empty investors didnt buy much of it european stocks ended the day up 07 which isnt much of a rebound considering the 37 hit the paneuropean stoxx 600 suffered on friday dip buyers are emerging across a host of sectors and as ever it will take a while for the market to claw back all the losses suffered last week wrote chris beauchamp chief market analyst at ig as some analysts cautioned today there are so many unanswered questions about the omicron variant that a wait and see strategy is probably proving a popular option among investors anyhow much of the credit for the limited bounce back is due to oil prices which have lifted energy stocks the clear winners of the session with a 2 jump travel and leisure shares also made a comeback with a 18 rise but again thats small change in comparison with the 88 drop on friday as a sign of the lack of conviction for the sector hotel operator accor and ba owner iag lost 08 and 03 respectively some of todays tech frenzy on wall street has washed on european shores but without much enthusiasm the sectors index rose 16 while the sp technology jumped 22 car makers were the worst performers with the sector losing 03 dragged down by frances faurecia down 79 which cut its guidance for the second time this year homes for the holidays pending home sales jump to 10month high 1105 et1605 gmt housing market data released on monday supported the notion that the sector despite slowing down under the weight of its own success still has some gas in the tank pending sales of preowned us homes usncheci surged by 75 last month blasting past consensus and posting a decisive rebound from septembers 24 decline according to the national association of realtors nar read more the increase sent the index to its highest print in ten months where it hovers well above precovid levels this solid buying is a testament to demand still being relatively high as it is occurring during a time when inventory is still markedly low writes lawrence yun nars chief economist indeed while the initial threats  and resulting lockdowns  surrounding the pandemic have waned its effects dont appear to be going away any time soon as evidenced the new omicron variant read more as a result demand for elbow room and home office space remains robust with many potential buyers finding additional impetus in the form of rising rents and interest rates motivated by fastrising rents and the anticipated increase in mortgage rates consumers that are on strong financial footing are signing contracts to purchase a home sooner rather than later yun added the initial suburban flight drove inventories to record lows even as homebuilders struggled replenish those inventories as they wrestled with land scarcity and a hobbled supply chain these factors launched home prices into the stratosphere and beyond the grasp of many potential buyers particularly and the lower end of the market but as rubeela farooqi chief us economist at high frequency economics points out inventories and home prices have both shown recent signs of easing inventories while they have declined over the last three months have moved up from lows earlier this year farooqi says gradually easing supply constraints should be a positive for existing home sales over time as a potential home sale is counted as pending once the contract is signed the data acts as a fairly accurate predictor of actual home sales a month or two down the line so much like the commerce departments building permits report which also showed a nice rebound in october pending home sales is among the sectors most forwardlooking indicators but the stock market is the most forwardlooking indicator of them all reflecting where investors believe the housing sector will be six months to a year down the road for nearly the first year of the pandemic the philadelphia se housing index hgx and the sp 1500 home building index spcomhome handily outshone the broader sp 500 but as shown in the graphic below index performance rebased to a year ago shows that relationship has since converged although the spcomhome has gained an edge of late nicely echoing the recent uptick in the nahbs homebuilder sentiment index wall street was heading sharply higher before the data hit rebounding from fridays steep selloff due to renewed pandemic fears in the form of our newest addition to the common vocabulary omicron but the perennial stayathome plays namely market leading tech megacaps have since taken a decisive lead pushing the nasdaq to the head of the pack even though markets have quickly switched from panic selling to dipbuying main equity benchmarks remain well below the levels they were at before omicron jitters wiped 2 trillion off stock markets worldwide at this point one may wonder how long could it possibly take for a complete recovery to answer that mediobanca looked at market behaviour in october last year when the delta variant was first spotted back then it took 10 days to rebound and reach new highs it says which suggests that this time around the recovery process should be faster given that the number of vaccinated is much higher and the time to market of new shots is shorter we might be back to highs quite soon the italian investment bank wrote in an email to clients us equity index futures were pointing towards a higher open on monday after fridays sharp selloff in a shortened postthanksgiving holiday session fueled by the finding of a new coronavirus mutation in south africa a top south african infectious disease expert said on monday that existing covid19 vaccines should be highly effective at preventing severe disease and hospitalization from the new variant named omicron and us president joe biden was due to update the public on the new variant and the us response later in the day read more the dow industrials dji suffered its biggest oneday percentage decline since october 2020 and the sp 500 spx saw its biggest daily percentage drop since february 25 on friday as concerns about the new variant rattled markets although many analysts said the selling was likely exacerbated by the light volume trading session after slumping about 10 a barrel on friday oil prices were rebounding by about 5 while travelrelated stocks such as american airlines aalo and norwegian cruise line nclhn also gained ground after tumbling on friday below is your premarket snapshot for mondays live markets posts prior to 0830 est1330 gmt  click here read more