U.S. stock futures were deep in the red early Friday, tracking heavy losses in Asian markets after scientists detected a new COVID variant in South Africa that could be the blame for a recent dramatic spike in cases.
Investors are returning to a shortened day of trading following the Thanksgiving Day holiday.
How are stock-index futures trading?
-
S&P 500 futures
ES00,
fell 1.1% to 4,644 -
Dow Jones Industrial Average futures
YM00,
slumped 546 points, or 1.5%, to 35,207 -
Nasdaq-100 futures
NQ00,
fell 0.6% to 16,255
On Wednesday, the Dow industrials
DJIA,
fell 9.42 points to finish nearly flat at 35,804.38. The S&P 500
SPX,
slipped 0.2% to close at 4,701.46, just 0.1% below its Nov. 18 record close of 4,704.54, according to Dow Jones Market Data. The Nasdaq Composite Index
COMP,
rose 0.4% to 15,84.23.
What’s driving the market?
The discovery of the new COVID variant was announced on Friday by South Africa’s health minister Joe Phaahla. He said scientists were concerned because of its high number of mutations and the dramatic spike in infections the country had seen over the past four or five days.
Speaking at an online press conference, he said the variant, presently known as B.1.1.529, had also been detected in Botswana and Hong Kong in travelers who had visited South Africa, he said. The World Health Organization’s technical working group is holding an emergency meeting to assess the variant, which scientists stlil aren’t sure whether is more deadly or just more contagious.
“The one bull in the China shop that could truly derail the global recovery has always been a new strain of Covid-19 that swept the world and caused the reimposition of mass social retractions,” said Jeffrey Halley, senior market analyst, at OANDA, in a note. “All we know so far is the B.1.1.529 is heavily mutated but markets are taking no chances.”
After new cases appeared to stabilize at 200 a day, South Africa reported more than 1,200 on Wednesday and 2,465 on Thursday. Scientists and health officials are concerned that such a highly mutating variant could escape vaccines. The U.K. government is banning flights from the country along with five other African nations, effective Friday.
As stock futures tumbled and stocks in Asia slumped, with the Nikkei 225 index
NIK,
falling an outsize 2.5%, investors flocked to perceived safer assets such as gold
GC00,
GCZ21,
,
which jumped $14 to $1,798.30, the Japanese yen
USDJPY,
up 0.7% to 114.50, and government bonds. The yield
TMUBMUSD10Y,
on the 10-year U.S. Treasury slid 9 basis points to…
Read More: Dow futures tumble 400 points on fears over new COVID variant