LONDON — European markets are set to open slightly lower in what’s likely to be a thin trading session on Christmas Eve, with traders keeping a watchful eye on the latest developments around the omicron Covid variant.

Britain’s FTSE 100 is seen losing 19 points at 7,362, Germany’s DAX down 1 point at 15,749 and France’s CAC off by 9 points at 7,102, according to IG index data. Markets in Italy and Switzerland are closed, while the London trading session will end early at 12.30 p.m. GMT.

Market players are juggling concerns over coronavirus restrictions and tighter central bank policy with signs that the heavily mutated omicron strain of the virus is milder than earlier variants like delta.

New studies in South Africa and the U.K. this week suggest omicron has a reduced risk of hospitalization and severe illness.

According to the South Africa research, which is not peer-reviewed, people infected with omicron are 80% less likely to be admitted to hospital compared with other variants. However, the authors said this may be due in part to higher immunity in the population, while South African health officials cautioned that the data should not be extrapolated to all countries.

A separate study in Scotland, also not peer-reviewed, suggests omicron is two-thirds less likely to result in hospitalization compared with delta. The U.K. Health Security Agency backed up the findings Thursday, saying someone with omicron was 50-70% less likely to be admitted to hospital.

Governments are searching for clues on the severity of the new variant, which is ripping through numerous countries much more rapidly than previous mutations. Authorities are worried the health system could come under huge pressure over the winter period amid what is now the fourth wave of infections.

More good news on the Covid front arrived Thursday as the U.S. government gave emergency approval to Merck’s antiviral pill for Covid, a day after authorizing a similar drug developed by Pfizer.

Still, traders are weighing the potential for tighter liquidity in 2022, with the Federal Reserve targeting an aggressive tapering of its huge stimulus program and three rate hikes.

The Bank of England is also taking a hawkish approach, becoming the first major central bank to hike interest rates since the pandemic began, while the European Central Bank is looking more cautious.

In Asia, markets were mixed Friday. Some major markets in the region, including Hong Kong and Singapore, close early for Christmas Eve.

U.S. markets are closed Friday for the Christmas holiday.

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