Stocks open higher on Wall Street; Southwest losses mount

Oil prices fell back and U.S. futures inched higher.

Not all world markets have ended the year on low notes. Britain’s FTSE 100 is at about the level it started 2022. Early Wednesday it was up 0.7% at 7,525.42.

But most other markets have suffered as interest rate increases, waves of coronavirus infections, the war, supply chain disruptions and surging inflation took a toll on businesses and investments.

Germany’s DAX lost 0.3% to 13,952.83. It’s down about 13% from the start of the year. The CAC 40 in Paris, which is about 9% below where it began the year, edged 0.1% lower, to 6,541.50.

The future for the S&P 500 was barely changed, down 1 point. The future for the Dow Jones Industrial Average edged 0.1% higher.

On Tuesday, the S&P 500 fell 0.4% and the Dow industrials eked out a 0.1% gain. The Nasdaq dropped 1.4%, while the Russell 2000 index dropped 0.7%.

The benchmark S&P 500 index set an all-time high at the beginning of January, but is now down nearly 20% for the year. The tech-heavy Nasdaq is down nearly 34%.

The Chinese government announced late Tuesday that it will start issuing new passports, a major step away from anti-virus travel barriers that likely will bring a flood of tourists out of China for next month’s Lunar New Year holiday.

The return of free-spending Chinese visitors to Asia, Europe and other destinations during what usually is the country’s busiest travel season will be a welcome relief for countries like Thailand that depend heavily on tourism.

But some governments have said they will impose extra precautions on people arriving from China given the widespread virus outbreaks there. U.S. officials, speaking on condition of anonymity to convey internal discussions, also expressed concern and said they were considering taking similar steps.

With China in the midst of its most severe COVID wave so far, disruptions to manufacturing and transport will likely linger until the worst is past.

“Investors are enthusiastic about China re-opening its economy. However, there are plenty of reports which suggest that COVID cases are on the rise in China, which really threatens the supply chain,” Naeem Aslam of Avatrade.com said in a commentary.

In Asian trading, Hong Kong’s Hang Seng climbed 1.6% to 19,898.91 while the Shanghai Composite index dropped 0.3% to 3,087.40. Hong Kong’s benchmark is down 14% for the year, while Shanghai’s has lost slightly more so far, at 14.2%.

Tokyo’s Nikkei 225, which has given up 8.6% this year, fell 0.4% to 26,340.50 after the government reported that Japan’s industrial production fell for a third straight month in November and was likely to fall further in December.

The Kospi in Seoul declined 2.2% to 2,280.45, while Australia’s S&P/ASX 200 dropped 0.3% to 7,086.40. Bangkok’s SET gained 0.3%.

Trading on Wall Street is expected to be relatively light this holiday-shortened week as investors look ahead to 2023 after a dismal year for stocks.

Uncertainty about how far the Federal Reserve and other central banks would go to fight the highest inflation in decades has kept investors on edge, even as price increases have eased. The Fed raised its key interest rate seven times this year and has signaled more hikes to come in 2023.

The high rates weigh heavily on prices for stocks and other investments and have raised worries they might slow the economy too much, tipping it into a recession.

In other trading, U.S. benchmark crude oil shed 54 cents to $78.99 per barrel in electronic trading on the New York Mercantile Exchange. It lost 3 cents on Tuesday to $79.53 per barrel.

Brent crude, the pricing basis for international trading, declined 39 cents to $84.29 per barrel.

The U.S. dollar rose to 134.01 Japanese yen from 133.43 yen. The euro was unchanged at $1.0641.