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What investors are saying about the new virus variant By Reuters

© Reuters. FILE PHOTO: Boys run previous a mural by Senzart911, of youngsters carrying facemasks amid the coronavirus illness (COVID-19) outbreak, at Soweto’s Kliptown, South Africa, October 27, 2021. REUTERS/Siphiwe Sibeko

SYDNEY/TOKYO (Reuters) – Asian shares suffered their sharpest drop in three months on Friday and oil costs tumbled after the detection of a presumably vaccine-resistant coronavirus variant despatched investors scurrying towards the security of bonds, the yen and the greenback. [MKTS/GLOB]

Little is understood of the variant, detected in South Africa, Botswana and Hong Kong, although scientists stated it has an uncommon mixture of mutations and might be able to evade immune responses or make it extra transmissible.

TAKASHI HIROKI, CHIEF STRATEGIST, MONEX, TOKYO

“This variant is a new risk for markets. We can’t tell how far it can evade vaccines.”

RAY ATTRILL, HEAD OF FX STRATEGY, NAB, SYDNEY

“People are reacting with the uncertainty about what this means. You shoot first and ask questions later when this sort of news erupts.”

MOH SIONG SIM, CURRENCY ANALYST, BANK OF SINGAPORE

“We nonetheless do not know the way infectious the virus is … it is a normal uncertainty. Markets are anticipating the danger right here of one other world wave of infections if vaccines are ineffective.

“Reopening hopes may very well be dashed.”

MARK ARNOLD, CIO, HYPERION ASSET MANAGEMENT, BRISBANE

“I do not suppose there’s any going again to the pre-COVID world. We’re simply going to get mutations by means of time and that is going to vary the means folks function in the economic system. That’s simply actuality.”

SHINICHIRO KADOTA, SENIOR FX STRATEGIST, BARCLAYS, TOKYO

“We see Germany contemplating a lockdown, so this new variant and flare-up in the COVID scenario poses some danger to market sentiment usually.

“If the COVID situation worsens, then dollar-yen could go down further, but otherwise the monetary policy divergence is definitely going to be weighing on the yen in the medium term.”

MARTIN WHETTON, HEAD OF FIXED INCOME, CBA, SYDNEY

“Keep an eye on the new COVID-19 variant. None of us are virologists, but all of us have seen the impact this has had on the intended path of central bank policy and markets.”

JEFFREY HALLEY, ANALYST, OANDA, JAKARTA

“The UK has paused flights from South Africa and 5 different neighbouring international locations, and we are able to count on extra of this elsewhere. The complacency seen with the emergence of the delta variant in India being a lesson harshly discovered.

“The one bull in the China store that would really derail the world restoration has at all times been a new pressure of COVID-19 that swept the world and brought on the reimposition of mass social retractions. All we all know thus far is the B.1.1.529 is closely mutated, however markets are taking no possibilities.”


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