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Europe Markets: European stocks skid on discovery of new virus variant as airlines, banks reel

European stocks were on track to their worst single-day performance of the year, getting hammered after the discovery of a new more virulent strain of coronavirus.

The Stoxx Europe 600

dropped 2.3% to 470.52, after the discovery of what for now is being called the B.1.1.529 variant, that’s believed to be driving a spike of cases in South Africa. The World Health Organization is holding an emergency meeting and may call the new variant ‘Nu.’

The French CAC 40

dropped over 3%, as the German DAX

and FTSE 100

also slumped. U.S. stock futures


also were rocked.

“We think it’s too soon to quantify the likely impact of this new variant but markets have had a very strong run over the last 12 months, and so it is no surprise to see a reaction like this,” said Dan Boardman-Weston, chief investment officer at BRI Wealth Management.

Investors flocked to safer assets such as the German bunds, U.S. Treasurys, and gold, with the 10-year bund

falling 7 basis points to -0.32%.

Each of the major sector indexes were dropping, led by travel and leisure and banks. Cruise operator Carnival

lost 14%, and British Airways owner International Airlines Group

stumbled 13%. The European Union was moving to halt air traffic from South Africa, a step the U.K. has already taken.

Italian diagnostics kit maker DiaSorin

and French lab instrument maker Sartorius Stedim Biotech

were among the few advancers.

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