(Bloomberg) --

The World Health Organization and the European Centre for Disease Prevention and Control said a new strain discovered by South African researchers is a “variant of concern,” as global markets swooned at the prospect of a setback in the fight against the coronavirus. 

Governments from the U.S. to Hong Kong tightened restrictions on travel from countries in southern Africa after the discovery of the new mutation. South Africa called the travel bans “unjustified,” while former FDA commissioner Scott Gottlieb said the measures were counterproductive.

Scientists are trying to ascertain how quickly the new variant, officially assigned the Greek letter omicron, can spread and whether it’s resistant to Covid-19 vaccines. The EU’s health agency suggested that vaccines may not work well against the mutation, while Moderna said it’s already conducting clinical studies of two multivalent booster candidates.

Global equities dropped, with the S&P 500 posting its biggest one-day slide since February and travel stocks among the biggest decliners. Commodities from copper to crude oil fell, while U.S. Treasuries and the yen strengthened on haven demand.  

Key Developments:

  • Virus Tracker: Cases reach 260 million; deaths pass 5.18 million
  • Vaccine Tracker: More than 7.86 billion shots given
  • What we know about the new virus variant that’s rocking markets
  • Scientists Racing to Decode Omicron as Defenses Buy Time
  • New Covid-19 Variant Is Already Disrupting Travel Across Globe
  • The winners and losers from a year of ranking Covid resilience

Australia Will Announce New Curbs, SMH Says (8:25 a.m. HK)

The Australian government will announce new precautionary measures in response to the emergence of the omicron strain, the Sydney Morning Herald and Age newspapers report, citing unidentified sources.

Measures are likely to include quarantine or isolation for Australians returning from southern Africa, according to the newspapers. There are currently no direct flights between South Africa and Australia.

On Saturday, New South Wales and Victoria states respectively reported 235 and 1,252 new cases.

Delta Has No Plans to Change S. Africa Service (6:57 a.m. HK)

Delta Air Lines Inc. will continue to operate flights between the U.S. and South Africa after the Biden administration imposed fresh travel restrictions on the country and several neighboring ones.

The carrier operates three flights per week between its Atlanta hub and Johannesburg. “There are no planned adjustments to service at this time,” the carrier said in an emailed statement.

Fed’s Bostic Plays Down Risk From Variant (6:50 a.m. HK)

Federal Reserve Bank of Atlanta President Raphael Bostic said the new variant would probably slow the U.S. economy somewhat, but the lessons learned during the pandemic indicated that the headwind would be less than in the past.

“We have a lot of momentum in the economy right now,” he said in an interview with Fox News. “That momentum, I’m hopeful, will be able to carry us through this next wave.” But he also cautioned that “all of that is predicated on the idea and the notion that the new variant is similar to delta.”

ECDC Concerned Vaccines May Not Work Well (5:49 a.m. HK)

Based on omicron’s mutation profile, partial immune escape is likely, the European Centre for Disease Prevention and Control said in a threat assessment report Friday.

The EU’s health agency is among the first official authorities to acknowledge that vaccines may not work well against the new strain.

“The omicron variant is the most divergent variant that has been detected in significant numbers during the pandemic so far, which raises concerns that it may be associated with increased transmissibility, significant reduction in vaccine effectiveness and increased risk for reinfections,” the ECDC said.

The ECDC pushed authorities to “urgently” reinforce pandemic restrictions, avoiding travel to affected areas, and the vaccination of holdouts. “Countries should consider a booster dose for those 40 years of age and over, first targeting the most vulnerable and the elderly and could then consider a booster dose for all adults 18 years and older at least six months after completion of the primary series.”

WTO Postpones Geneva Ministerial Meeting (4:43 a.m. HK)

The World Trade Organization postponed its in-person ministerial conference in Geneva as Switzerland tightened travel restrictions, people familiar with the situation said.

The conference will be convened as soon as conditions allow, they said.

Gottlieb Calls Travel Curbs Counterproductive (4:18 a.m. HK)

Scott Gottlieb, a former FDA commissioner, took to Twitter to express his disapproval of the travel restrictions being imposed due to the latest variant, saying they hurt current containment efforts and discourage future sharing.

U.S., Canada Curb Travel From Southern Africa (2:05 p.m. NY)

President Joe Biden’s administration will restrict travel from South Africa and seven other countries starting on Monday, according to senior administration officials. In addition to South Africa, they include Botswana, Zimbabwe, Namibia, Lesotho, Eswatini, Mozambique and Malawi.

The policy doesn’t apply to American citizens and lawful permanent residents, though they must still test negative prior to travel to the U.S.

Canada is banning the entry of foreign nationals who have traveled through southern Africa in the last 14 days.

We are “acting quickly to protect the health and safety of Canadians,” Health Minister Jean-Yves Duclos told reporters in Ottawa.

Netherlands Tightens Curbs (1:10 p.m. NY) 

The Dutch government will force bars and restaurants to close in the evening for the next three weeks, seeking to cap a surge in infections that’s heaped pressure on the nation’s battered health system.

The country will enter an evening lockdown, with non-essential sites from cinemas to gyms shutting down at 5 p.m. each day from Sunday. Supermarkets will close from 8 p.m., and schools will be unaffected. 

WHO Says B.1.1.529 is Variant of Concern (1:11 p.m. NY) 

The World Health Organization has designated B.1.1.529 as a variant of concern, posing a threat that could confound countries’ efforts to slow the spread of Covid-19, according to a web statement. 

The WHO assigned the Greek letter omicron to the variant. 

The variant “has been detected at faster rates than previous surges in infection, suggesting that this variant may have a growth advantage,” the WHO said. 

Vaccine Makers Study Variant’s Impact (12:55 p.m. NY) 

AstraZeneca says it’s investigating the impact of new Covid variant on the vaccine developed with University of Oxford, with studies under way in Botswana and Eswatini. 

The company is testing antibody treatment against new variant, and says it’s hopeful of efficacy due to “potent antibodies with different and complementary activities against the virus.” 

Johnson & Johnson, maker of a one-dose Covid shot, is already testing its vaccine against B.1.1.529, CNBC reported, citing the company.

BioNTech said earlier it expects the first data within two weeks of how the strain interacts with the vaccine it makes with Pfizer. 

Back to Netflix and Chill? (12:34 p.m. NY) 

So-called stay-home winners, stocks that benefit from higher demand in lockdowns, rose on Friday as concerns about the impact of a new Covid-19 variant hit broader markets.

Video-conferencing firm Zoom Video rose as much as 13%; home exercise company Peloton was up 6.8%; food delivery firm DoorDash ros 1.2%; and streaming giant Netflix advanced 2.6%.  

EU Members Ban Travel From Southern Africa (12:19 p.m. NY) 

European Union member states agreed to introduce restrictions on all travel into the EU from seven countries in reaction to the new Covid variant, Commission spokesman Eric Mamer says in a tweet.

Emirates Suspends Flights From Variant Areas (11:56 a.m. NY) 

Emirates Airlines suspended flights from seven Southern African countries starting Monday. Travelers originating from or transiting from those countries won’t be accepted into Dubai.

Saudi Arabia also made a similar decision, suspending flights from countries after the discovery of the new coronavirus strain. Mauritius also plans to suspend flights from South Africa. 

Norway to Enforce Quarantine for African Travelers (11:45 a.m. NY) 

Norway will introduce mandatory quarantine from Saturday for all arrivals from South Africa and six other countries in the region to prevent the spread of the new virus variant, NRK says, citing Prime Minister Jonas Gahr Store.

S. Africa Calls Travel Bans Unjustified (11:19 a.m. NY) 

South Africa’s Health Minister Joe Phaahla said new travel bans imposed on the country after the discovery of a new Covid strain, particularly by the EU, were “unjustified.”

The moves “are completely against the norms and standards” advised by the World Health Organization, Phaahla said during an online press conference. 

U.K. Daily Cases Top 50,000 Again (11:02 a.m. NY) 

The U.K. reported 50,091 more coronavirus cases on Friday. According to government statistics, this was the first time since Oct. 21 where cases were above 50,000. 

The country recorded 160 Covid-19 deaths on Friday. The U.K.’s high vaccination rate has been credited with keeping deaths at a fraction of levels from last winter even with Covid cases persistently high. 

Singapore’s Cases Continue to Fall (10:25 a.m. NY) 

Cases are falling in Singapore. The city-state reported 1,090 new positives on Friday, down from 1,275 a day earlier. New cases have been falling for about a month. 

Some 1,064 new cases were found in the community; that compares with 1,633 a week earlier. The weekly infection growth rate was at 0.74 as of Friday, versus 0.75 on Thursday. Singapore reported a further three deaths from Covid complications.  

EU Agency Names New Covid Strain ‘Variant of Concern’ (9:50 a.m NY) 

The European Centre for Disease Prevention and Control labeled the new Covid-19 straight first identified in South Africa as a “variant of concern.” 

The B.1.1.529 variant, a highly contagious variant with cases already detected in Israel and Belgium, has roiled global travel plans and markets, driving steep sell-offs in airline stocks and buoying lockdown staples like Zoom. 

Hong Kong is Latest to Bar Travelers From Southern Africa (9:46 a.m. NY) 

Hong Kong said it would bar entry to non-residents who’ve stayed in eight southern African countries within 21 days, citing the latest coronavirus variant.  

Israel ‘On the Verge’ of Emergency, PM Says (8:36 a.m. NY) 

Prime Minister Naftali Bennett said Israel was “on the verge of an emergency” after the new variant discovered in southern Africa was detected in a passenger arriving from Malawi.

Israel widened a travel ban to include all of Africa, with the exception of nations in the continent’s north, and said they’d purchase another 10 million PCR tests calibrated to detect the new variant. Sewage will be examined to locate any outbreaks and quarantine rules for Israelis returning from barred countries were tightened.

©2021 Bloomberg L.P.