DUBAI: The new variant of COVID-19, Omicron, has sparked global economic concerns, as fears of its spread begin to affect stock markets and oil prices.
Saudi Arabia’s main market, the Tadawul All Share Index, opened down 5.3% on Sunday, trading at nearly 10,700 points.
Dubai’s financial market fell 8.49% early in the session, with developer Emaar Properties losing 7.9%, while budget airline Air Arabia plunged 7.1%.
In Abu Dhabi, the index fell 2.3%, led by a 3.1% drop for First Abu Dhabi Bank, the UAE’s largest lender, and a 3% drop for the telecommunications company Etisalat.
âIt is evident that traders are concerned about the implications of the newly mutated virus which brings back memories of last year’s lockdown. If Saudi Arabia decides to impose more restrictive measures, the economy will be strongly impacted and the prospects for growth next year will disappear, âsaid Mohammed Al-Suwayed, CEO of Razeen Capital.
He said now is the time for investors to reinvest in the market, as stock prices are relatively low.
Oil prices fell in their biggest drop since April 2020, with Brent prices falling 11.55% to $ 72.72 a barrel as markets close on Friday, while WTI slipped 13.06% at $ 68.15 per barrel.
The variant was first discovered in South Africa and has also since been detected in Belgium, Botswana, Israel, UK, Australia and Hong Kong.
The SARS-CoV-2 virus evolution technical advisory group met today to review what is known about the # COVID-19[FEMALE[FEMININE variant B.1.1.529.
They advised the WHO to designate it as a variant of concern.
WHO named it Omicron, according to naming protocols https://t.co/bSbVas9yds pic.twitter.com/Gev1zIt1Ek
– World Health Organization (WHO) (@WHO) November 26, 2021
In the Middle East, Israel is the only country to have reported a case of the new variant so far, but some governments in the region have issued travel restrictions to prevent the spread of the virus.
Saudi Arabia on Sunday expanded the list of African countries where it has banned travel because of Omicron, adding Malawi, Zambia, Madagascar, Angola, Seychelles, Mauritius and the Comoros.
– Ø§ÙØ·ÙØ±Ø§Ù Ø§ÙÙ Ø¯ÙÙ (@ksagaca) November 27, 2021
The Kingdom previously halted flights to and from South Africa, Namibia, Botswana, Zimbabwe, Mozambique, Lesotho and Eswatini.
Other countries in the Middle East, including the United Arab Emirates, Bahrain, Morocco and Jordan have taken similar steps.
#NCEMA and the General Civil Aviation Authority: entry suspension for travelers from South Africa, Namibia, Lesotho, Eswatini, Zimbabwe, Botswana and Mozambique from November 29. https://t.co/iOSLgyjp2p#TogetherWeRecover pic.twitter.com/ZFumTANelx
– NCEMA WATER (@NCEMAUAE) November 26, 2021