European and Asian stock markets plunged on Friday following reports of a new Covid-19 strain from South Africa, which, investors fear, could result in new travel curbs.
Chinese, Japanese and Indian stocks dropped. The Shanghai Composite Index lost 0.56%, the Nikkei 225 in Tokyo tanked by 2.5%, while the Hang Seng in Hong Kong had plunged 2.67% as of 08:20 GMT.
Indian benchmarks dropped to nearly three-month lows, with the Sensex and the Nifty50 both losing over 2%. New Zealand and Southeast Asian markets also declined.
Major European indexes were also plunging on the news. Europe's Euronext 100 and London's FTSE 100 fell 3%. Germany's DAX dropped 2.9%, while France's CAC plunged 3.6% at the start of Friday's trading.
"There is fear of this new variant spreading to other countries which might again derail the global economy... So the markets might continue to reel under pressure and would actively track the Covid situation globally," Hemang Jani of Motilal Oswal Financial Services told CNBC.
Reports of the new and possibly vaccine-resistant "super mutant" Covid-19 variant, dubbed B.1.1.529, sparked fears among investors, fearing more travel curbs after the UK temporarily suspended flights from South Africa and neighboring states in response to the new strain.
Countries have widely used travel restrictions to slow the spread of Covid-19 since the start of the pandemic last year. The US lifted its travel ban on 33 countries, including the UK, earlier this month.
The World Health Organization is set to hold an emergency meeting later on Friday to discuss how the new variant may react to vaccines and treatments, officials announced on Thursday. Apart from South Africa, the new strain has also been detected in Botswana and Hong Kong.
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