US stocks fell on Tuesday after Fed Chairman Jerome Powell announced earlier dates for reducing bond purchases. He also told the Senate Banking Committee that it is time to stop using the word "temporary" to describe inflation, which is why traders increased their bets on early interest rate hikes. The S&P 500 dropped by almost 1.45% because of this.

But the first round of rate hike is still scheduled for July because Fed officials have consistently said they want to end the bond purchase program first before raising rates.

In addition, in his opening remarks, Powell said the recent rise in Covid-19 cases and the emergence of the omicron strain pose "risks to employment and economic activity and heighten uncertainty about inflation." He also mentioned evidence of price increases since officials met on November 2-3.

FBB Capital Partners research director Mike Bailey said: "Investors may have expected Powell to run for cover as the omicron variant threatens growth, However, he did an about-face and signaled faster tapering, spooking markets."

Concerns over the impact of omicron also hit the markets on Tuesday, when executives at Moderna stated that numerous mutations indicate that new vaccines will be required. But the head of BioNTech SE said the current generation of vaccines can protect people who are infected with this variant from serious illnesses. The University of Oxford also stated that there was no evidence that existing shots will not provide some protection against the strain.

Going back to economic statistics, consumer confidence in the US fell to a nine-month low in November, mainly due to rising Covid-19 cases and accelerating inflation. Final sales for Cyber Monday also fell short of estimates as scarce inventory kept shoppers from breaking out their credit cards at the start of the holiday shopping season.

Other important events for this week are:

- manufacturing PMI report in China (Wednesday);

- manufacturing data in the eurozone (Wednesday);

- construction costs and manufacturing activity in the US, Fed's Beige Book (Wednesday);

- OPEC meeting on oil production (Thursday);

- data on US jobless claims (Thursday);

- report on US employment, production orders and durable goods (Friday).