(Bloomberg) -- European stocks neared a record high reached in November, tracking a rally on Wall Street on Monday, but gains were capped as traders weighed mixed government responses to the omicron variant.
The Stoxx Europe 600 Index ended the session 0.6% higher in very low trading volumes, while the U.K. market remained closed for a holiday. U.S. shares hit a fresh record on Monday as American consumers spent at a strong pace over the holiday shopping season despite the spread of omicron.
European stocks are more likely to follow the U.S. market higher over the coming weeks, said Esty Dwek, chief investment officer at Flowbank SA. “Businesses have proven impressive adaptability to restrictions, and while additional curbs are likely in the short term, they are unlikely to impact overall 2022 European growth, which should see the continued bounce from reopening.”
Global Covid-19 cases hit a daily record on Monday. Among the most recent developments in response to the outbreaks, France will force its citizens to work from home for most of next month to contain the spread of the highly transmissible omicron variant. Elsewhere, an outbreak continued to spread in the western Chinese city of Xi’an, days after its 13 million residents were locked down. Meanwhile, the U.K. government won’t introduce stricter restrictions in England before the end of the year.
The Stoxx 600 is just shy of its record high reached in November, while trading volumes have been drying up this week.
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