By Mark DeCambre and Barbara Kollmeyer
U.S. stock benchmarks suffered withering losses on Friday as stock and commodity markets plunged, after scientists detected a new COVID variant in South Africa that could be to blame for a recent sharp surge in cases, especially in Europe.
U.S. markets were closed for Thanksgiving on Thursday and ended at 1 p.m. Eastern Time on Friday, three hours earlier than usual, and bond market trading ends at 2 p.m., an hour earlier than is typical.
How are stock-index futures trading?
The S&P 500 /zigman2/quotes/210599714/realtime SPX -0.57% fell 106.84 points, or 2.3%, to 4,594.62.
The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -0.19% slumped 905.04 points, or 2.5%, to 34,899.34, with the index logging the worst daily drop since Oct. 28, 2020, according to FactSet data.
The decline for the Dow saw it mark its first close below its 50-day moving average at 35,261.93 since Oct. 14.
The Nasdaq Composite Index COMP declined 353.57 points, or 2.2%, to15,491.66.
The decline for the S&P 500, Dow and Nasdaq Composite posted their worst Black Friday performance since 1950 .
On Wednesday , the Dow industrials /zigman2/quotes/210598065/realtime DJIA -0.19% fell 9.42 points to finish nearly flat at 35,804.38. The S&P 500 /zigman2/quotes/210599714/realtime SPX -0.57% slipped 0.2% to close at 4,701.46, just 0.1% below its Nov. 18 record close of 4,704.54, according to Dow Jones Market Data. The Nasdaq Composite Index /zigman2/quotes/210598365/realtime COMP -1.14% rose 0.4% to 15,84.23.
What’s driving the market?
It was an ugly day for stock investors during a thinly traded Black Friday session, which was susceptible to big swings on alarming news from public health officials who were assessing a new variant of the coronavirus that causes COVID-19.
Late in the session, the World Health Organization’s technical advisory group assigned the B. 1.1.529 variant of the virus the Greek letter omicron and declared it a “variant of concern,” as it did with the delta variant.
Fear of a new variant overshadowed the usual focus on U.S. Black Friday shopping day, which puts the focus on retailers as consumers shop for bargains.
Particularly notable about the variant is the “large number of mutations, some of which are concerning,” the WHO group said in a statement. The mutations could make omicron more resistant to the current batch of vaccines.
The discovery of the new COVID strain was announced on Friday by South Africa’s health minister Joe Phaahla . He said scientists were concerned because of its high number of mutations and the dramatic surge in infections the country had seen over the past four or five days.
“The pandemic and COVID variants remain one of the biggest risks to markets, and are likely to continue to inject volatility over the next year(s),” wrote Keith Lerner, co-chief investment officer and chief market strategist at Truist Advisory Services, in a Friday note. “It’s hard to say at this point how lasting or impactful this latest variant will be for markets,” the analyst wrote.
The omicron strain has been detected in Botswana and in Hong Kong in travelers who had visited South Africa.