US futures were in deep red early Friday, tracking heavy losses in Asian markets after scientists discovered a new COVID variant in South Africa could be to blame. for the recent spike in cases.
Investors are returning to a shortened trading day after the Thanksgiving holiday.
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S&P 500 futures
down 1.1% to 4.644
Dow Jones Industrial Average Futures
down 546 points, or 1.5%, to 35,207
down 0.6% to 16,255
Above Wednesday, the Dow industry
down 9.42 points to close at 35,804.38 points. S&P 500
fell 0.2% to 4,701.46, just 0.1% below the Nov. 18 close of 4,704.54, according to Dow Jones Market Data. Nasdaq Composite Index
up 0.4% to 15,84.23.
What drives the market?
The discovery of a new COVID variant is South African Health Minister Joe Phaahla announced on Friday. He said scientists are concerned because of its high mutation count and the dramatic increase in infections the country has seen over the past four or five days.
Speaking at an online news conference, he said the variant, now known as B.1.1.529, has also been detected in Botswana and Hong Kong in travelers who have been to South Africa, he said. The World Health Organization’s technical working group is holding an emergency meeting to assess the variant, which scientists aren’t sure if is more deadly or just more contagious.
Jeffrey Halley, senior market analyst at OANDA, said: “A bull in the Chinese store could really derail the global recovery that has always been a new strain of Covid-19 that has swept the world. and trigger the re-emergence of mass social retreats,” said Jeffrey Halley, senior market analyst, at OANDA. in a single note. “All we know so far is that B.1.1.529 is heavily mutated but the market has no chance.”
After new cases appeared to be stabilizing at 200 a day, South Africa reported more than 1,200 on Wednesday and 2,465 on Thursday. Scientists and health officials fear that such a highly mutated variant could escape the vaccine. The UK government is banning flights from the country along with five other African countries, effective from Friday.
As futures fall and stocks in Asia plunge, with Nikkei 225
down more than 2.5%, investors flock to safer assets like gold
up $14 to $1,798.30, Japanese yen
rose 0.7% to 114.50, and government bonds. Quantity
on 10-year US Treasuries fell 9 basis points to 1,5517%.
US crude oil price
fell 3% to $75.90 per barrel on fears of falling demand amid fresh variation.
“Currently it is understood that the number of cases is small, but given the thin level of liquidity in Asian trading as a result of the US holiday, the response is likely to be overwhelming, with an increase in into bonds, sending yields plunging, and gold higher,” said Michael Hewson, chief market analyst at CMC Markets.
Investors are returning from the Thanksgiving break with a short session for the US market, often accompanied by thinner volume as traders typically wait until Monday to get back in. There is no economic data on the calendar for Friday. But the week has boiled over with concerns about rising COVID cases in Europe and new restrictions.
Fear of a new variant has overshadowed Black Friday shopping days, which has led retailers to focus on retailers as consumers shop for bargains.
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