How the markets are reacting on the news of the latest coronavirus variant

By CNN Business

Updated 6:06 p.m. ET, November 30, 2021
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11:06 a.m. ET, November 30, 2021

Powell: The Fed may wind down its stimulus sooner than expected

From CNN Business' Anneken Tappe

Now that the Federal Reserve has announced the end to its pandemic-era stimulus program, the next question is how long will it take until its fully rolled off.

That could happen sooner than most expect.

"At this point the economy is very strong and inflationary pressures are high and it is therefore appropriate in my view to consider wrapping up the taper of our asset purchases ... perhaps a few months sooner," Fed Chair Jerome Powell testified before the Senate Tuesday.

Earlier this month, the Fed announced it would reduce the pace of those monthly purchases, slashing bond buying by $10 billion for Treasury securities and $5 billion for agency mortgage-backed securities.

At its December meeting, the central bankers will discuss whether this pace is still appropriate, Powell said.

He also added that by then, the bankers will have seen another labor market report -- due this Friday -- and might know more about the new Omicron variant of the coronavirus.

It's about learning about the transmissibility, the ability of existing vaccines working against it and about the severity of the illness if contracted, Powell said.

"Then and only then we can make an assessment on the effect on the economy," he added.

10:48 a.m. ET, November 30, 2021

Let's stop saying 'transitory': Powell

From CNN Business' Anneken Tappe

"Transitory" has been one of those pandemic buzzwords to describe inflation. Fed Chair Jerome Powell thinks it's time we stop using it.

The Federal Reserve uses "transitory" to describe the Covid-era jump in prices, which the central bank believes to be temporary. Although temporary sounds like it should be short-term, prices have been on the rise for a while now.

The traditional meaning of "transitory" is not what the Fed thinks it means at all. According to the central bank, transitory means it won't leave any marks on the economy one the trends reverse again... whenever that may be.

"Everything is transitory. Life is transitory," said Pennsylvania Senator Pat Toomey during the hearing.

"It's probably a good time to retire that word and explain what we mean," Fed Chairman Jerome Powell said in response.

He continued that the Fed's test for high inflation has been met now, meaning that prices have been on the rise for long enough for the central bank to change its policy, which it announced earlier this month.

"Generally speaking the higher prices we're seeing can be traced back to the pandemic," Powell said. But the increases are now more broad, and the upward pressure on inflation is no longer isolated, he added.

10:48 a.m. ET, November 30, 2021

We need more data on Omicron: Yellen

From CNN Business' Anneken Tappe

The Omicron variant is on everyone's mind, but Treasury Secretary Yellen echoed President Joe Biden in saying that we simply didn't know enough about it yet.

"We're still waiting for more data but what remains true is that our best protection against the virus is the vaccine," Yellen said in her opening remarks at the Senate hearing. "People should get vaccinated or boosted."

Even so, Yellen believes that the recovery is still in a good place, particularly when comparing it to last winter, when things weren't looking so good.

The Secretary also stressed again that Congress needed to expand the US debt limit to ensure that the recovery can continue.

10:39 a.m. ET, November 30, 2021

Yellen believes there's a place for stablecoins, but they need to be regulated

From CNN Business' Anneken Tappe

The Treasury Department has made clear that it thinks stablecoins -- cryptocurrencies that are pegged to real-world assets such as the US dollar -- should be regulated.

At the start of the month, the President's Working Group on Financial Markets, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency urged Congress to slap bank-like rules on the assets.

But on Tuesday, Yellen said: "I believe that stablecoins can lead to some efficiency in the payments system...," the Secretary said, "but only if they're adequately regulated."

10:16 a.m. ET, November 30, 2021

Yellen and Powell kick things off in Washington

From CNN Business' Anneken Tappe and David Goldman

In Washington, a hearing of the Senate Banking Committee with Treasury Secretary Janet Yellen and Federal Reserve Chairman Jerome Powell is getting under way.

"The recent rise in Covid-19 cases and the emergence of the Omicron variant pose downside risks to employment and economic activity and increased uncertainty for inflation," Powell wrote in prepared testimony he's set to deliver Tuesday to the Senate Committee on Banking, Housing, and Urban Affairs.

Powell also noted the economy took a body blow in the summer as the Delta variant spread across the globe. Many Americans were afraid to travel, shop, eat at restaurants and return to the office. That kept caregivers at home, exacerbating the labor shortage and supply chain crisis that have held back the US economy.

Read more about Powell's testimony here.

10:46 a.m. ET, November 30, 2021

Consumer confidence dips in November

From CNN Business' Anneken Tappe

A person shops at an outdoor food market in Manhattan on November 05, 2021 in New York City.
A person shops at an outdoor food market in Manhattan on November 05, 2021 in New York City.

Americans are feeling less confident about the economy again, according to new data from The Conference Board.

The consumer confidence index slipped to 109.5, lower than the level economists had expected, and below the 111.6 level recorded in October.

Bot the assessments of current business and job conditions, as well as the near-term outlook for incomes, business, and job conditions fell this month.

“Expectations about short-term growth prospects ticked up, but job and income prospects ticked down. Concerns about rising prices—and, to a lesser degree, the Delta variant—were the primary drivers of the slight decline in confidence," said Lynn Franco, Senior Director of Economic Indicators at The Conference Board.

And that's just as the Omicron variant is arriving in the collective consciousness.

The Conference Board thinks a resurgence in infections, as well as rising prices, could be a threat to economic growth in the months to come, even though a strong holiday season is expected.

9:33 a.m. ET, November 30, 2021

Stocks slide again

From CNN Business' Anneken Tappe

US stocks opened in the red again Tuesday, rattled by renewed worries about the Omicron variant of the Coronavirus.

Investors fear that the variant could evade some immunity provided by vaccines and antibodies, sending the global economy back into trouble. Market participants will also be watching Federal Reserve Chairman Jerome Powell’s testimony before the Senate Banking Committee Tuesday morning.

9:39 a.m. ET, November 30, 2021

Oil sinks on Omicron fears

From CNN Business' Jill Disis

Oil prices are sliding, after collapsing Friday on fears that the variant would hurt energy demand by eating into the amount of people driving and flying.

Both Brent crude, the global benchmark, and West Texas Intermediate, the US benchmark, fell about 4% to trade below $71 and $68 a barrel, respectively.

8:40 a.m. ET, November 30, 2021

US stocks set to open sharply lower

From CNN Business' David Goldman

US stock futures tumbled Tuesday after bouncing back Monday.

Investors fear that the Omicron variant could evade some immunity provided by vaccines and antibodies, sending the global economy back into trouble.

Jerome Powell, who is set to testify before the Senate Tuesday morning, wrote in prepared testimony that Omicron could worsen inflation, the job market and the supply chain crisis if it proves to be a potent virus.

  • Dow futures were down 400 points, or 1.1%.
  • S&P 500 futures fell 0.9%.
  • Nasdaq futures were 0.5% lower.