11 / 21


After an initially good start on the financial markets, the mood turned from optimism to pessimism. Nervousness on the stock markets increased significantly towards the end of the month and actually reached new highs for the year in Europe (EuroStoxx 50 volatility index +73%). Accordingly, equity investments lost ground across the board. Fears about the new, more contagious Omicron virus variant unsettled market participants and led to broad profit-taking. More information on vaccine protection against the new variant is not expected until two to four weeks from now. According to the manufacturers, a new booster vaccination, which is likely to be designed for the new variant, is not expected until the late first quarter of 2022. Beyond the news about the virus, economic data in the USA again surprised on the upside and the trend in Europe was equally positive. Initial jobless claims and the number of new jobs created in the USA paint a picture of a prospering labor market. In addition, inflation (consumer prices) has risen more strongly and more broadly than expected. This could prompt the no-ten banks to accelerate their tightening course in the foreseeable future - were it not for the new virus variable. In Germany, the Social Democrats, the Greens and the Liberals were able to agree on a coalition treaty. The alliance has set high sustainability goals and wants Germany to get 80% of its electricity from clean energy sources by 2030. The phase-out of coal energy is now planned for as early as 2030 - eight years earlier than previously set. Whether the change can succeed as a double phase-out, i.e. including the shutdown of nuclear power plants, is a controversial issue. Outside Germany, nuclear power is already experiencing a small renaissance due to the climate crisis (see FOCUS).

Equity markets

Global equity indices suffered from sharp declines. Looking at the index landscape, there was hardly a region that was trading positively in November. The DAX lost 3.8% and the even more cyclical Spanish IBEX 35 fell by as much as 8.3%. In Asia, the Hang Seng lost 7.5% and the Nikkei 3.7%. U.S. equity markets proved more solid thanks to strong technology stocks. The S&P 500 lost 0.8% and the Nasdaq 100 even ended the month up 1.8%. Even before news of the new Omicron variant surfaced, equity markets were beginning to show signs of fatigue after a strong October. Market breadth was extremely low and already served as a warning signal for a correction. Segments of the market that would benefit from the normalization of the global economy (hotels, airlines, etc.) were hit hard.

Interest Rates

Due to the uncertainty regarding the Omicron variant, safe government bonds were again highly demanded. The yields of the 10-year U.S. Treasuries were still quoted at 1.44% and Swiss government bonds again yielded negative -0.26%. With high inflation, there have hardly been moments in history when real yields have been as negative as they are today. Caused by the burgeoning virus fears and the ongoing loose monetary policy of the U.S. Federal Reserve, U.S. real yields are trading at -1.1%, based on ten-year inflation-protected government bonds.

Currencies / Commodities

Gold closed the month almost unchanged after a short-term rise, while silver lost 4.5%. Cyclical commodities were the losers. The price of a barrel of oil (WTI) fell by almost 20%. In addition to the virus also weighed on the plans of the U.S. government to release strategic oil reserves - OPEC +, on the other hand, was unsurprisingly against an expansion of supply. Despite the energy transition, "black gold" will continue to occupy an important place in the energy mix of many countries. In order to achieve the net zero emissions target by 2050, developing countries in particular are currently relying on additional nuclear energy (see FOCUS). The next positive development for the topic could come from the EU - which is currently discussing whether gas and nuclear power should be classified as "green" in the future. France wants to expand the already high share of nuclear energy together with renewable energies and demands that the EU promotes nuclear energy as sustainable.


We classify the recent market correction as a correction of the previously strong short-term optimism in the market and remain cautious with regard to the possible, still little foreseeable consequences resulting from the new Sars-Cov-2 virus variant. In principle, however, we assume that in the medium term the uncertainty in the outlook will again fade and that the current correction should prove to be a buying opportunity, as the fundamental drivers of the bull market are still fully intact and the vaccine protection should not prove to be completely useless even against the new variant, especially against severe diseases (hospitalizations).


Focus Market Forecast