© Reuters. FILE PHOTO: Passers-by wearing protective masks reflect on an electronic board displaying stock prices outside a brokerage house amid the coronavirus disease (COVID-19) outbreak in Tokyo, Japan , September 29, 2021. REUTERS / Issei Kato
By Tom Westbrook
SYDNEY (Reuters) – Asian stocks suffered their biggest drop in two months on Friday after the detection of a new, possibly vaccine-resistant variant of the coronavirus prompted investors to rush to the safety of bonds, the yen and the dollar. dollar.
The largest MSCI index for Asia-Pacific stocks excluding Japan fell 1.3%, its biggest drop since September. Casino and beverage stocks were sold in Hong Kong, and travel stocks fell in Sydney.
slipped 2.5% and oil futures also fell nearly 2% on new demand fears.
Scientists said the variant, detected in South Africa, may be able to evade immune responses. British officials believe it is the most important variant to date, fear it may be vaccine-resistant and have rushed to impose travel restrictions on South Africa.
“You shoot first and ask questions later when this kind of news breaks out,” said Ray Attrill, head of FX strategy at National Australia Bank (OTC 🙂 in Sydney.
fell 1% to a one-year low in early trading. The risk-sensitive Australian and New Zealand dollars fell to their lowest level in three months and fell 0.9%.
Sales in Asia have global stocks, on course for their worst week since early October. fell 1%, while Euro STOXX 50 futures and futures contracts each fell around 1.4%.
Little is known about the new variant. However, scientists told reporters that there is a “very unusual constellation” of mutations, which are of concern because they could help it bypass the body’s immune response and make it more transmissible.
“Markets here anticipate the risk of another global wave of infections if vaccines are ineffective,” said Moh Siong Sim, currency analyst at the Bank of Singapore.
“Hopes of reopening could be dashed. ”
Treasury bill movements were also large after the Thanksgiving holiday, and yields quickly pulled back some of the week’s gains. Benchmark 10-year yields fell almost 6 basis points to 1.5841%.
The yen jumped about 0.4% to 114.84 per dollar and lost 0.5% for the last time to $ 0.7148.
The measures come amid concern over COVID-19 outbreaks resulting in restrictions on movement and activity indoors and as markets aggressively assess the rise in U.S. rates next year.
European countries have extended COVID-19 booster vaccinations and tightened restrictions overnight. Slovakia has announced a two-week lockdown, the Czech government will close bars earlier and Germany has crossed the threshold of 100,000 COVID-19-related deaths.
Shanghai curtailed tourism activities on Friday and a nearby city cut public transportation as China doubles its zero-tolerance approach that is also disrupting traders.
At the same time, a host of stronger-than-expected US data points have caused federal funds futures markets to price up to three rate hikes in 2022.