Fear of viruses leads to weak stocks and oil prices
EU wants travel from affected countries to be suspended
Marcus Stuart (MS)October 5, 2026
On Wall Street, stocks plunged on the Friday after the reopening after Thanksgiving, while European stocks saw their biggest sell-off in 17 months, with oil prices plummeting $ 10 a barrel as fears of a new variant of coronavirus kept investors safe Let plants flee.
The World Health Organization (WHO) on Friday classified a new variant of COVID-19 with a large number of mutations discovered in South Africa as "worrying" - the fifth variant to receive this designation.
Unofficially, the Dow Jones Industrial Average closed down 2.53% at 34,899.34 points, the largest percentage decline in more than a year. The S&P 500 was down 2.27%, its biggest daily loss since February 25, and the Nasdaq Composite was down 2.23%, its biggest daily loss in two months.
U.S. markets closed early on Friday after closing all day on Thursday for the Thanksgiving holiday.
The reference index STOXX 600 ended the day with a minus of 3.7% and was thus 4.5% in the red this week. The volatility indicator for the main stock market reached its highest level in almost 10 months.
Companies that benefited from a relaxation of COVID-related restrictions this year, such as AMC Entertainment (NYSE: AMC), aircraft engine maker Rolls Royce (LON: RR), easyJet (LON: EZJ), United Airlines, and Carnival (NYSE: CUK) Corp. all fell.
Retail values fell as Black Friday, the start of the Christmas shopping season, began as the new variant fueled concerns about low traffic in stores and inventory issues.
In Europe, the travel and leisure index slumped 8.8% and saw the worst day since the COVID-19 shock sell-off in March 2020.
"The bottom line is that COVID is still the investors' narrative, much of the movement today is being driven by the South African variant," said Greg Bassuk, chief executive officer of AXS Investments in Port Chester, New York.
"We've talked about four or five factors that have been driving activity in the last few months - inflation fears, some economic data, Fed policies - but what we have seen over the last year is that the big developments around COVID are some of these dwarfed other factors and that is what drives market activity today.
Little is known about the variant, discovered in South Africa, Botswana, and Hong Kong, but scientists said it had an unusual combination of mutations and might be able to bypass immune responses or make the virus more transmissible.
Great Britain called the new variant the most important to date and was one of several countries that imposed travel restrictions for southern Africa.
The European Commission also said it would consider suspending travel from countries where the new variant has been identified, despite the WHO warning of hasty restrictions.
Global stocks fell 1.81%, their largest drop in more than a year. The French CAC 40 was down 4.8%. The British FTSE 100 fell 3.6%, while the German DAX fell 4.2% and the Spanish IBEX 5.0%.
Malaysian rubber glove maker Supermax, which was up 1500% during the first wave of the pandemic, jumped 15%.
The MSCI index for Asian stocks outside Japan fell 2.44%, its largest decline since late July.
In commodities, oil prices plummeted. Gold prices made up for earlier gains as they moved away from riskier assets.
U.S. crude oil was down at 1:21 p.m. EST (1812 GMT) last fell 12% at $ 69.02 a barrel. Brent crude fell 10.5% to $ 73.59.
The gold price fell 0.09%.
With investors looking for safe investments, the Japanese yen rose 1.87% against the dollar, while the pound sterling last traded at $ 1.3331, up 0.08%.
The dollar index fell 0.757% while the euro rose 1% to $ 1.1318.
US Treasury bond yields saw their steepest decline since the pandemic began. The yield on 10-year government bonds recently rose to 1.4867%. The yield on the 2-year bond recently rose from 0.644% to 0.4941%. [US /]
"With the decline in US 10-year Treasury yields, an escape to safety is underway," said Keith Lerner, co-chief investment officer, Truist Advisory Services. "The immediate cause of the sell-off is yesterday's announcement of a new variant of COVID-19 in South Africa that investors fear could affect economic growth."
The market volatility comes against the background of already growing concerns about COVID-19 outbreaks, which are restricting freedom of movement and activity in Europe and beyond.
Previously, the markets had expressed positive feedback about the strength of the economic recovery, despite mounting fears of inflation.
