Shares fall due to fears of new strain of coronavirus | Financial markets

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Equities, US government interest rates and oil junk as new covid-19 efforts rattle the markets.

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Equities, government interest rates and oil fell on Friday as the yen jumped as a new Covid-19 strain discovered in southern Africa sent a wave of caution across global markets.

A stock gauge for Asia-Pacific was set for the worst decline since March, with Japan and Hong Kong underperforming and travel shares among the biggest declines. US and European futures fell and the 10-year government interest rate fell to 1.56%.

The World Health Organization and researchers in South Africa are studying the newly identified variant, which is described as very different from previous versions and of serious concern. Britain and Israel banned flights from South Africa and some neighboring countries. Hong Kong confirmed two cases of the tribe.

The dollar was at a 16-month high, while the South African rand weakened and commodity currencies retreated. Crude oil dropped 3% and gold rose. US markets, closed on Thursday for Thanksgiving, will have a shortened Black Friday session.

The discovery of the strain comes on top of concerns in the markets about high inflation and the prospect of a faster exit from extremely loose monetary conditions. Global equities rose about 16% this year and managed a plethora of risks after investors poured nearly $ 900 billion into stock exchange-traded and long-only funds in 2021 – surpassing the total of the past 19 years.

“It’s a scary headline” about the virus variant, so it may have caused a knee-jerk reaction, says Kyle Rodda, an analyst at IG Markets Ltd. He added that “North America outside the desks means that there is no wall of buyers” and that thinner markets provide more pronounced movements.

Variant ‘playbook’

December futures on the Cboe Volatility Index, a measure of implied stock fluctuations for the S&P 500, rose as traders prepared for turbulence as US markets reopened.

Justin Tang, head of Asian research at United First Partners, pointed out that “the world has gone through this before with delta”, adding “there is already a game book for such situations” and that “mutations are expected and not something unknown.”

At the same time, Goldman Sachs Group Inc.’s economists said they expect the Fed to tighten policy faster than previously expected, including doubling the rate at which it reduces bond purchases to $ 30 billion a month from January. They see a rise in interest rates from close to zero in June.

In China, regulators have asked Didi Global Inc.’s top executives to draw up a plan for delisting from US stock exchanges, said people familiar with the matter. It can revive fears about Beijing’s intentions for its giant technology industry. A meter of Chinese technology stocks fell.

The Chinese economy continued to slow in November with car and housing sales falling again when a crisis in the housing market dragged on, according to Bloomberg’s overall index of eight early indicators.

For more market analysis, read our MLIV blog.

Here are some important events this week:

  • Bank of England Governor Andrew Bailey talks to Mohamed El Erian at a Cambridge Union event. Thursday
    Some of the most important movements in the markets:

Stock

  • The S&P 500 futures fell by 1% at 5 in the morning in London. The S&P 500 rose 0.2% on Wednesday
  • Nasdaq 100 futures fell 0.5 percent. The Nasdaq 100 rose 0.4 percent on Wednesday
  • Japan’s Topix index fell 2.2%
  • Australia’s S & P / ASX 200 index fell 1.7%
  • South Korea’s Kospi index fell 1.6%
  • Hong Kong’s Hang Seng Index fell 2.2%
  • China’s Shanghai Composite Index lost 0.6%
  • Euro Stoxx 50 futures fell 2.1%

Currencies

  • Bloomberg Dollar Spot Index Rise 0.2%
  • The euro was at 1.1223 USD, up 0.1%
  • The Japanese yen was 114.72 per dollar, up 0.6%
  • The offshore yuan was 6.3934 per dollar, down 0.1%

Bonds

  • The US 10-year government interest rate fell eight points to 1.56%
  • Australia’s 10-year bond yield fell nine basis points to 1.78%

Merchandise

  • West Texas Intermediate crude fell 3% to $ 76.06 a barrel
  • Gold was at $ 1,797.75 per ounce, up 0.5%

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