(MarketWatch) — 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.

  • The Dow slumped -905.04 or -2.53%
  • The S&P 500 fell -106.84 or -2.27%
  • The Nasdaq declined -353.57 or -2.23%
  • 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.

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 omicron strain has been detected in Botswana and in Hong Kong in travelers who had visited South Africa.

Trading around the Thanksgiving holiday is often associated with lower trading volumes as traders typically wait until Monday to return to work. There was no U.S. economic data on the calendar for Friday. 

After new cases stabilized at 200 a day, South Africa reported more than 1,200 on Wednesday and 2,465 on Thursday. 

The U.K. government is banning flights from South Africa along with five other African nations, effective Friday.

Drugmaker stocks were on the rise, including PfizerPFE advanced by 6.1%, and Moderna MRNA stock rallied by about 21%. 

Travel-related stocks were on the backfoot: Expedia EXPE fell nearly 9,5% Shares of airliners and cruise ships Delta Air Lines DAL, fell 8.3%, Norwegian Cruise NCLH, down 11.4%, and Royal CaribbeanRCL shares slid 13%, United AirlinesUAL declined 9.6%, Southwest Airlines LUV shares dropped 4.3%, American Airlines’s AAL stock slumped 8.8%. 

Meanwhile, shares of companies associated with the stay-at-home trade were set to rise, including Netflix NFLX rose 1.1% and Peloton Interactive Inc. advanced 3.4%, while Zoom Video Communications Inc. shares rallied 5.7%. 

Gold futures for December delivery GCZ21 rose less than 0.1% to trade at $1,785.30 an ounce. U.S. oil futures CLF22 traded off more than 12% at around $68.27 a barrel.

Full Loaf Hot LinkOriginal Article By: Mark DeCambre

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