The global stock market fell Friday.
Andrew Burton is a photographer.
Global stocks are being hammered on Friday after a new variant of COVID was identified in South Africa, causing countries to limit travel and sparking fears of another wave of cases.
Scientists are trying to find out if the new variant is more deadly than previous ones. South Africa has confirmed around 100 cases, but it's already been found in Hong Kong.
Global investors don't like what they're seeing. The S&P 500 futures are suggesting that stocks will plunge at the start of the trading day. The futures for the blue chip index dropped 2%.
In Europe, the Stoxx 600 fell 2.51% in morning trading after Tokyo's Nikkei fell 2.5% overnight. Oil prices have plummeted as investors worry about the possibility of more travel bans.
Analysts at Commerzbank called it a "black Black Friday". The new variant is shaking markets.
Poor liquidity is driving the market.
"US equity futures fell from the moment they opened overnight on the new Covid variant news," said Steen Jakobsen, chief investment officer at Saxo Bank.
The market is only for a half session and many traders are away from their desks for a long holiday weekend, so any significant flows by traders looking to reduce risk could mean significant volatility.
Markets are not taking any chances.
Jeffrey Halley, senior market analyst at trading platform Oanda, said that investors were voting this morning.
A new strain of Covid-19 that swept the world and caused the re-imposition of mass social retractions is the only bull in the china shop that could derail the global recovery.
The markets are taking no chances and haven't been doing well. US 10-year bond yields have fallen.
Growth and central banks should help cushion the blow.
"With equity markets at all-time highs, thin year-end liquidity and COVID cases up again, a pull-back seems logical," said Emanuel Cau, head of European equity strategy atBarclays.
"We believe that resilient growth and patient central banks should continue to provide cushion on a medium-term horizon, while investors have dry powder to buy dips."
The key is to find out if current vaccines are still effective against the variant. Uncertainty might force central banks to be cautious.
The travel industry has been hit by a violent storm.
"Fear has gripped the financial markets with the travel industry flying into another violent storm, after the discovery of a new COVID strain which could be far more contagious and may render vaccines less effective," said Susannah Streeter, senior investment and markets analyst at broker Hargreaves Lansdown.
There are fears that the COVID strain discovered in states in Southern Africa will prompt fresh shutdowns.
The decision by the UK government to impose strictQuarantine rules on six southern African countries within hours has rattled the travel and tourism industry.
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Business Insider has an original article.
