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LONDON — European stock markets climbed on Monday as China's unexpectedly muted growth slowdown and optimism over the impact of the Omicron coronavirus variant boosted investor confidence.

Oil rose modestly on limited supply concerns, while the dollar was up against major rivals as Wall Street was closed for a US public holiday.

The fast-spreading Omicron strain had initially sparked fears for the global economic recovery, but studies indicating that it causes milder illness and government booster vaccine programmes have calmed traders' nerves.

London, Paris and Frankfurt all ended the day higher.

"The relatively lower mortality rates, coupled with ongoing vaccinations efforts, has raised hopes we will transition to endemic and that the economy will recover strongly," said market analyst Fawad Razaqzada of ThinkMarkets.

Britain's benchmark FTSE 100 index climbed to new highs in 2022 after pharma giant GlaxoSmithKline rejected a bid worth £50 billion ($68 billion, 60 billion euros) from Pfizer for a consumer healthcare unit.

GlaxoSmithKline shares rose to the top of the index, while Pfizer's sank to the bottom as the US pharma behemoth said it would press on with a bid for GSK Consumer healthcare.

Concerns over soaring inflation and the US Federal Reserve's stance on hiking interest rates to counter it did not temper investor confidence in European stocks.

The trend was "due to a relatively more dovish central bank and the potential for a strong rebound in economic growth as nations ease travel restrictions amid ongoing booster vaccination efforts", said Razaqzada.

"As we head into 2022, we believe that the post-pandemic bull market remains broadly intact," added Bank of Singapore analyst Eli Lee.

"Historically, bull markets do not end at the beginning of rate hike cycles, and positive trends in global economic growth and earnings continue to be positive fundamental drivers for the market."

China on Monday defied expectations and posted growth figures of 8.1 per cent in 2021, although this slowed in the final months amid fresh coronavirus outbreaks, disruptive regulatory crackdowns and property market crises.

COVID infections in the world's second-largest economy climbed to their highest level since March 2020 as Beijing pursues its zero-COVID policy ahead of the Winter Olympics.

But mainland China shares were supported by news that the country's central bank had cut interest rates for the first time since the height of the pandemic last year as officials look to kickstart stuttering growth.

"Rising infections in China just three weeks before the Winter Olympics could lead to widespread economic uncertainty, particularly if the situation is not handled effectively in the short term," said XTB market analyst Walid Koudmani.

Benchmark oil contract Brent North Sea briefly reached the highest level for more than three years at $86.71 per barrel, adding to strong inflation concerns.

"Markets remain focused on the delicate balance between supply and demand which has appeared to impact price fluctuations quite significantly throughout most of the post pandemic economic recovery," said Koudmani.

Credit Suisse fell almost 1.8 per cent after the Swiss bank's chairman resigned less than a year after taking the reins following reports he had broken COVID quarantine rules.

Antonio Horta-Osorio's immediate departure adds to the bank's troubles after it was last year rocked by links to the multibillion-dollar meltdowns at financial firms Greensill and Archegos.

TUNIS — Tunisia's crisis-stricken economy needs "deep reforms" such as slashing its vast public wage bill, the International Monetary Fund's (IMF) outgoing country chief has said as the government seeks a new bailout.

Jerome Vacher, speaking in an interview at the end of his three-year term as the global lender's envoy to the North African country, said the coronavirus pandemic had helped create Tunisia's "worst recession since independence" in 1956.

"The country had pre-existing problems, in particular budget deficits and public debt, which have worsened," he said.

Tunisia's debts have soared to nearly 100 per cent of Gross Domestic Product.

Its GDP plunged by almost 9 per cent in 2020, the worst rate in North Africa, only modestly offset by a 3 per cent bounceback last year.

That is "quite weak and far from enough" to create jobs to counteract an unemployment rate of 18 per cent, Vacher said.

He said young graduates face particular challenges in finding work, despite the country being able to offer "a qualified workforce and a favourable geographic location".

Since president Zine Al Abidine Ben Ali was toppled by mass protests in 2011, Tunisia's troubled democratic transition has failed to revive the economy.

President Kais Saied sacked the government and suspended parliament on July 25 last year, and the government has since asked the IMF for a bailout package — the fourth since the revolution.

Tunisian authorities say they are optimistic about reaching a deal by the end of this quarter.

Vacher said discussions are still at an early stage and that the IMF first wants "to understand what they're planning in terms of economic reforms".

"It's an economy that needs very deep, structural reforms, especially to improve the business environment," the French economist said.

Hefty public wage bill 

But Vacher added that the government "understands the main challenges and problems, which is already a good basis", urging Tunisia to come up with a "solid and credible" reform plan.

To do that, it must tackle its huge spending on public sector salaries.

"The public wage bill is one of the highest in the world," Vacher said.

In a country of 12 million people, more than half of public spending goes to paying the salaries of around 650,000 public servants — a figure that does not include local authority wages.

Nor does the figure include Tunisia's hefty public companies, which often hold monopolistic positions across sectors from telecoms to air transport and employ at least 150,000 people at the public expense.

All this drains resources that the state could be investing in education, health and infrastructure, Vacher said.

"There needs to be a big efficiency drive in the public sector [to meet] public expectations in terms of services," he said.

The IMF has long called for a restructuring of Tunisia's system of subsidies on basic goods such as petrol and staple foods, which essentially see more state funds doled out to the biggest consumers — a system Vacher said was unfair.

The lender recommends scrapping subsidies and instead creating a system of targeted cash payments to needy groups.

The IMF's recommendations are important as not only could it lend billions more to Tunisia, but other bodies including the European Union have said they will condition future aid on the global lender's green light.

For Vacher, the biggest responsibility lies in the hands of Tunisia's decision makers.

"It's up to them to act to find solutions, put forward reforms, a vision and an ambition," he said.

While many observers have predicted doom for Tunisia's public finances, Vacher said the situation is "not optimal, but manageable".

But "there is an urgent need to make the public finances more sustainable."

LONDON — Stock markets retreated on Friday as US retail sales and bank earnings disappointed and investors worried the Fed may hike interest rates aggressively.

A pledge by Fed chief Jerome Powell earlier this week to rein in surging prices while also nurturing recovery in the world's top economy provided a much-needed lift to investor sentiment and helped propel a rally across equities.

Data showing US inflation appeared to be stabilising added to the positivity and tempered fears about the end of the ultra-loose monetary policies, which have been key to a near two-year markets rally and global economic rebound.

But the mood darkened on Thursday after the officials' comments.

Lael Brainard, in her Senate hearing to become Powell's deputy, said rates could rise as early as March, a move supported by Fed Bank of Philadelphia chief Patrick Harker, who also raised the possibility of another three before the end of the year.

The heads of the Chicago and St Louis Feds saw a similar number of hikes, while Raphael Bostic of Atlanta was open to a March move.

Minutes from the bank's December policy meeting showed officials were keen to act quickly to tame prices, and speed up the taper of its massive bond-buying programme, then begin offloading its Treasury holdings — measures that have been used to keep rates at all-time lows.

"The possibility of four rate hikes this year is growing," said Oanda senior market analyst Edward Moya.

"With four [policy board] voters now expecting to hike in March, financial markets can't rule out it is possible that they could deliver five rate hikes this year."

The comments helped lead to steep losses across Wall Street on Thursday, with the Nasdaq dropping more than 2 per cent, as tech firms are more susceptible to higher borrowing costs.

The selling continued on Friday in Asia and Europe, where official data showed Germany's economy grew modestly last year and likely shrank in the final months.

Wall Street fell further on Friday with a lacklustre set of bank earnings failing to help sentiment. 

Shares in JPMorgan Chase were 5.3 per cent lower after the bank reported a 14 per cent drop in fourth quarter profits amid higher costs for employee compensation.

Sentiment was also hit by data showing retail sales dropped 1.9 per cent month-on-month in December.

"The key takeaway from the report is that total retail sales, which are not adjusted for inflation, contracted at their fastest pace since last February in the face of broadly higher prices," said Patrick O'Hare at Briefing.com. 

"This suggests that inflation is weighing down consumer spending," he added.

Meanwhile, oil prices hit the highest levels for more than two months.

"Crude oil prices have continued to look resilient with concerns about geopolitical risk and a Russian incursion into Ukraine raising the stakes, as well as keeping a floor under prices," said Michael Hewson at CMC Markets.

"With some OPEC+ members already struggling to lift production to meet the new output targets, concern over supply shortfalls has been growing," he added.

SAN FRANCISCO — A federal judge on Tuesday ruled that US regulators' re-worked anti-trust case against Facebook can go ahead, saying the complaint was more robust and detailed than the version denied last year.

The US Federal Trade Commission has alleged the social media giant, which has renamed itself Meta, holds an illegal monopoly by acquiring potential competitors that it now owns like Instagram and WhatsApp.

Judge James Boasberg's ruling is a blow to Facebook, which faced renewed scrutiny last year after a whistleblower leaked documents showing executives knew the harm their services could cause to teens, democracy and users' well-being. 

The FTC "may well face a tall task down the road in proving its allegations," but the case will not be dismissed, ruled Boasberg, who last year tossed out the original suit.

His ruling on Tuesday denied a push by Facebook, which did not reply to a request seeking comment, to also dismiss the re-worked complaint.

"The Commission continues to allege that Facebook has long had a monopoly in the market... and that it has unlawfully maintained that monopoly," Boasberg wrote.

"The facts alleged this time around to fortify those theories, however, are far more robust and detailed than before," he added.

The judge also rejected Facebook's argument that the case should be dismissed because the commission's decision to amend and refile was fueled by a bias against the company by FTC chairwoman Lina Khan.

That contention missed the mark, the judge reasoned, because Khan is a prosecutor, not a judge bound to neutrality.

"Ultimately, whether the FTC will be able to prove its case and prevail at summary judgment and trial is anyone's guess," the judge said in the ruling.

In the amended complaint, the FTC said Facebook's dominance "is protected by high barriers to entry," and that "even an entrant with a superior product cannot succeed against the overwhelming network effects enjoyed by an incumbent personal social network."

The lawsuit, which could take years to go through the courts without a settlement, calls for the court to order "divestiture of assets," including WhatsApp and Instagram, to restore competition.

Boasberg said in his dismissal ruling last year that the agency's initial lawsuit lacked evidence, notably in defining the market that Facebook was allegedly monopolising.

LONDON — Stock markets rose and the dollar fell against most currencies on Wednesday despite figures showing US inflation rising at its fastest pace since June 1982.

The US consumer price index (CPI) jumped 7 per cent in 2021, the highest increase since June 1982, adding pressure on authorities to tame surging inflation wave brought on by the pandemic and response efforts.

But investors appeared to take the data in their stride after Federal Reserve chief Jerome Powell indicated on Tuesday he was ready to raise interest rates while trying to preserve the US recovery from the COVID-19 crisis.

US and European stocks all pushed higher after the inflation data, with the tech-rich Nasdaq, which had been particularly jittery at the start of the year, rising 1 per cent at the start of trading.

"It looks like the market had prepared for even hotter inflation, which obviously didn't materialise. So the reaction can best be described as relief," said Fawad Razaqzada, an analyst at ThinkMarkets. 

Fears of an abrupt end to the ultra-loose monetary policies, which have helped power a two-year market rally, made for a torrid start to trading this year. But on Wednesday, the mood appeared resolutely upbeat.

European and US markets appeared sanguine about the price rises in the world's biggest economy after Powell's reassurances on Tuesday.

Oil prices also rose on Tuesday whereas the dollar was down.

While most observers expect equities to endure some tough times in the near future, they remain broadly upbeat about the outlook for this year.

"It would appear relentless optimism is perhaps returning to the markets and dip buyers are diving back in, Craig Erlam, senior market analyst at Oanda, wrote in a note to clients.

NEW YORK — Boeing delivered more than twice as many commercial aircraft in 2021 as the year earlier, according to figures released on Tuesday.

However, it still lagged its archrival Airbus in the closely-watched industry benchmark, the figures showed.

Boeing, the US aviation giant, benefitting from the return of its 737 MAX jet in most leading markets, delivered 340 planes last year, up from 157 in 2020.

But that level is still below Airbus' 611 deliveries in 2021. Deliveries are tied to company revenues and closely monitored by investors.

The figures are the latest to point to Boeing's partial recovery from both the lengthy grounding of its 737 MAX model following two fatal crashes, and the downturn in the commercial plane business during COVID-19 that halted many new plane orders for more than a year.

Boeing executives have said they expect passenger traffic to return to pre-pandemic levels in 2023 or 2024, and for the company to recover its long-term growth trends a few years after that.

In early December, China cleared the MAX to resume service, the last major market to reauthorise the single-aisle airplane after its grounding.

But Boeing over the last year ran into trouble with its 787 Dreamliner, halting deliveries of the jet in May following quality issues and cutting production levels. Boeing delivered just 14 Dreamliner planes in 2021, down from 53 the prior year. 

Boeing has seen some $1 billion in added production costs due to the 787 problems. The company is engaged in "detailed discussions" with federal aviation regulators about resuming deliveries, Boeing said in a quarterly securities filing. 

On the positive side, Boeing had net orders of 535 commercial planes for 2021, meaning its contracts for new planes more than offset cancelations for the first time in three years.

The aviation giant also scored a record number of new freighter orders, reflecting additions by UPS, FedEx and others in response to rising e-commerce demand.