Stocks fall on fears of new coronavirus variant

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Stocks fall on fears of new coronavirus variant

U.S stock futures fell Friday, with global markets rattled by a new coronavirus variant discovered in South Africa, which fanned fears that new growth-crushing lockdowns could be imposed.

Due to the Thanksgiving holiday in the U.S., trading volumes were low, and could be a factor in the volatility. Major benchmarks indicated a rough opening on Wall Street's post-Thanksgiving session. Dow futures contracts YM F plunged 800 points, or 2.5%, while futures for the S&P 500 ES F and Nasdaq NQ F fell sharply.

A new coronaviruses variant was discovered in South Africa, leading to an emergency session of the World Health Organization. The 529 strain is a concern because it has a large number of mutations found in other variants - including the fast-spreading Delta variant that exploded over much of the summer, and it seems to be spreading rapidly.

There is no evidence yet, but health officials are worried that the mutating variant could dilute or resist the efficacy of vaccines.

It goes without saying that it is still too early to say how big a threat the new B will be. Neil Shearing, Group Chief Economist at Capital Economics, said 529 strain poses to the global economy.

The lessons from the past couple of years is that it is the restrictions imposed in response to the virus rather than the virus itself that causes the bulk of economic damage. Shearling wrote that 529 strain spreads.

He said that governments in the U.S. and the U.K. have taken a learn to live with the vaccine approach, and will be less likely to impose new restrictions because of the fact that it will depend on the extent to which it escapes the vaccines and, importantly, causes strains in national healthcare systems.

The U.S. crude futures fell by 6.2% to $73.57 per barrel on fears of falling demand amid the new variant, which swooned on fears of falling demand. Bond yields have fallen as the market's inflation fears temporarily gave way to the desire for safe-haven assets. The yield on the 10-year U.S. Treasury note was down to 1.53% after closing at 1.63% on Wednesday.

There isn't a major economic release scheduled for Friday. The stock market will close at 1 p.m. The holiday weekend is coming to an end on Friday.