Global markets: US futures and oil plunge on new Covid variant fears

Asian stocks led the way, with Hong Kong Hang Seng Index (HSI) It decreased by 2.7%, while Japan Nikkei 225 (N225) It decreased by 2.5%. European markets saw heavy selling, with major indices including the FTSE100, France’s CAC 40 (CAC 40) and Germany Dax (Dax) All decreased by between 2.5% and 3%.
US markets, which were closed Thursday for Thanksgiving, fell ahead of the start of the shortened trading session on Friday. daw (UNDUE) Futures fell more than 700 points, or about 2%. futures contracts for Standard & Poor’s 500 (INX) And Nasdaq (COMP) They decreased by about 1.6% and 1%, respectively.

The price of US oil fell 6 percent to about $ 73.50 a barrel. Brent crude, the global oil standard, fell 5 percent to about $78.

The South African Minister of Health said, on Thursday, that a new type of Corona virus is spreading rapidly in parts of the country. It has also been discovered in Botswana, Hong Kong and Israel.

British Health Minister Sajid Javid, a replacement “may be more transmissible” than the Delta strain and that “the vaccines we currently have may be less effective”. The new strain has already prompted the UK government to ban flights from six African countries. Some EU countries are taking similar measures.

Jeffrey Haley, chief market analyst for Asia Pacific at Oanda, said in a research note on Friday that investors were “scared” by the discovery of the new Covid-19 variant.

Economists were already watching a rise in Covid-19 cases in Europe. Some countries have introduced new restrictions to contain the spread, raising the possibility of lower activity this winter at a time when inflation and supply chain problems are already clouding growth prospects.

“Unlike the current wave of infections in the heart of Europe, there is a new type of … virus that is spreading rapidly in South Africa causing serious concerns,” Berenberg Bank economists commented in a note on Friday.

“If Germany were to impose a national lockdown, we would likely have to cut our fourth-quarter GDP forecast for Germany and the eurozone a bit more,” they added.

Airlines and travel stocks were among the biggest decliners on Friday.

“With the delta wave in mind earlier this year, investors are likely to shoot first and ask questions later until more is known about it,” Haley said.

Rob North contributed to this article.

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