The US stock market closed more than 900 points down on Friday. The Dow Jones Industrial Average dropped about 905 points, marking its worst day of 2021. The S&P 500 and Nasdaq Composite also dropped 2.3 per cent and 2.2 per cent, respectively.
CNBC market analyst Jim Cramer said he was not advising investors to sell just yet.
“When I read that there’s one [case] in Belgium and one in Botswana, we’re going to wake up next week and find one in this country. And I’m not going to recommend anyone buy anything today until we’re sure that isn’t going to happen, and I can’t be sure that it won’t,” he said.
The World Health Organization is calling the variant Omicron, and several nations – including the US – are implementing travel bans to help stem the spread of the virus.
Starting Monday, Americans will be barred from traveling to or returning from South Africa, Botswana, Zimbabwe,Namibia, Lesotho, Estwatini, Mozambique and Malawi.
According to senior officials speaking to Politico, the decision to implement a travel ban for the African nations was advised by Dr Anthony Fauci, the Director of the National Institute for Allergy and Infectious Disease, and the US Centres for Disease Control.
Dr Fauci told CNN that US officials were collaborating with South African colleagues to better understand the variant. According to Dr Fauci, Omicron’s mutations “are raising some concern, particularly with regard to possible transmissibility increase and possibly evasion of immune response”.
The doctor added: “We don’t know that for sure right now – this is really something that’s in motion– and we just arranged right now, a discussion between our scientists and the South African scientists a little bit later in the morning to really get the facts. We want to find out scientist-to-scientist exactly what is going on.”
In the meantime, investors and economists will be watching the economy to see if the markets will bounce back after the discovery of the variant.
Neil Shearing, the Group Chief Economist at Capital Economics, noted to Yahoo Finance that “the lesson from the past couple of years is that it’s the restrictions that are imposed in response to the virus – rather than the virus itself – that causes the bulk of the economic damage. So, the key question is how governments will respond in the event that the B.1.1.529 strain spreads.”
At least one company’s value spiked as a result of the news; Pfizer, the manufacturer of one of the most popular coronavirus vaccines available, rose 8 per cent before the markets closed on Friday.