Stock markets and oil prices plunged on Friday over fears of a new coronavirus variant that scientists warn could be more infectious than the Delta strain and more resistant to vaccines, potentially dealing a heavy blow to the global economic recovery. The Dow saw its worst drop of the year as Wall Street indices plunged and the dollar floundered, while haven investments such as the yen and Swiss franc rallied. “It’s a single-track market today,” said Ross Mayfield, investment strategy analyst at Baird, pointing to fears that the new variant could be worse than the Delta strain, which slowed US growth and hiring in the third quarter. “I think the market’s reaction to the level of uncertainty being faced right now, especially near all-time highs before this, probably makes some sense,” he said. US crude oil prices tumbled more than 13 percent and the main international contract lost nearly 12 percent, which CMC Markets analyst Michael Hewson attributed to “concerns that this new mutation could add to the pressure on demand.” OANDA’s Craig Erlam told AFP that traders are worried about new restrictions and people’s behavior this winter, given the new variant. “Even without severe restrictions, people will adopt more caution, which will weigh on-demand,” he said. Fears of the new variant have already led several countries in Europe and Asia, including the US, to ban or sharply limit travel from southern Africa. Share prices of airlines and tourism groups dived, while there were big losses also for energy groups. On Wall Street, the carnage included a 2.5 percent loss for the Dow in a session of shortened hours following the Thursday Thanksgiving holiday. Europe’s main equity markets ended the day lower as well, with the FTSE 100 shedding 3.6 percent and Paris and Frankfurt falling more than four percent, after sharp declines in Asia. “It’s Black Friday today for the retailers, but it’s ‘Red Friday’ right now for the stock market,” said Patrick O’Hare at Briefing.com. Justin Tang at United First Partners said that while the latest news was worrying, “the world has gone through this before” with the Delta variant, adding that governments were more adept at knowing how to deal with the situation. “Mutations are expected and not something unknown,” he said. Germany’s BioNTech said it was studying how well the coronavirus vaccine it developed with US drugs giant Pfizer protects against the new variant. Near the close of US trading, European Union officials holding an emergency meeting over the new variant agreed to urge all 27 nations in the bloc to restrict travel from southern Africa, the region where it was first detected. Traders were also debating what the new variant could mean for the Federal Reserve as the US central bank considers its next moves to fight soaring global inflation, which is an additional threat to economies. The Fed is beginning to pull back its pandemic stimulus with an eye to ending it completely in the middle of next year. Rate hikes could start then, but some officials have mulled speeding up the process to bring the increases forward to fight price hikes. However, Briefing.com’s O’Hare said the emergence of the new variant presents a new complication. “Certainly, in the heat of today’s headline moment, there will be added concern about the Fed making a policy mistake,” he said.