The Dow Jones fell over 900 points just after opening bell on Nov. 26, with other major Wall Street stock indexes—and risk assets more generally—also seeing sell-offs as news of a new COVID-19 variant spreading in South Africa seems to have sparked a broader risk-off sentiment among investors.

By 10:30 a.m. New York time, the Dow was down around 870 points, or 2.44 percent, after briefly falling more than 900 points before seeing a slight relief rally. The benchmark S&P 500 fell nearly 100 points, or around 2 percent, after markets opened, and by 10:30 a.m. was trading down around 89 points, or 1.89 percent, while the tech-heavy Nasdaq was down around 200 points, or 1.23 percent.

Overnight headlines about the emergence of the new COVID-19 variant in South Africa sent a ripple of uncertainty across markets, knocking down U.S. and global shares, sending crude oil prices tumbling over 10 percent, as skittish investors pivoted to haven assets like U.S. Treasurys and gold.

The VIX volatility index, often referred to as the Wall Street fear gauge, shot up over 40 percent, suggesting an elevated sense of worry among investors.

“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, an analyst at Oanda, in Jakarta, Indonesia.

“All we know so far is the B.1.1.529 is heavily mutated, but markets are taking no chances,” he added.

Little is known about the new COVID-19 variant, detected in South Africa, Botswana, and Hong Kong, but South African scientists say it has an unusual combination of mutations and may be able to evade immune responses or make it more transmissible. COVID-19 is the disease caused by the CCP (Chinese Communist Party) virus.

“We don’t know very much about this yet,” Maria van Kerkhove, who works as an epidemiologist for WHO on COVID-19, said in public comments.

“What we do know is that this variant has a large number of mutations,” she said. “And the concern is when you have so many mutations it can have an impact on how the virus behaves.”

Market analysts said that, given the uncertainty, investors were predictably reacting with greater caution.

“We still don’t know how infectious the virus is … it’s a general uncertainty,” said Moh Siong Sim, currency analyst at Bank of Singapore. He said markets were responding to the risk of another global wave of infections, adding that “reopening hopes could be dashed.”

While scientists say they still have much to learn about the new variant, its emergence has already prompted renewed travel restrictions.

Britain temporarily banned flights from South Africa, Namibia, Botswana, Zimbabwe, Lesotho, and Eswatini from Friday, and asked returning British travelers from those destinations to quarantine.

Authorities in the European Union are seeking to halt air travel from the southern African region amid rising concern about the variant.

“The Commission will propose, in close coordination with Member States, to activate the emergency brake to stop air travel from the southern African region due to the variant of concern B.1.1.529,” EU Commission chief Ursula von der Leyen said on Twitter Friday.

She said the Commission will recommend that all 27 EU member states implement the measure, adding that she hopes for the European Council to give the green light as soon as possible.

Officials in Japan confirmed Friday that they would impose a 10-day quarantine requirement on anyone traveling from southern Africa.

“The key to crisis management is to prepare for the worst,” cabinet secretary Hirokazu Matsuno said Friday, according to the Japan Times newspaper.

A technical group from the World Health Organization is to meet Friday to discuss the new variant in an urgent sitting requested by South Africa.

Mimi Nguyen Ly, Jack Phillips, and Reuters contributed to this report.

https://www.theepochtimes.com/dow-jones-drops-900-points-on-opening-bell-as-new-covid-19-variant-roils-markets_4125637.html