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International Market Update
- European stocks slumped Friday on fears of a new, highly mutated variant of Covid-19. The pan-European Stoxx 600 closed down 3.7%, with stocks in the travel and leisure sector leading the way with an 8.8% drop, while all other sectors and major bourses slid sharply lower. European investors were already tracking the acute covid crisis in the region amid rising infections that prompted a handful of countries to impose new restrictions. Concerns grew over a new Covid variant and the UK suspended flights from six countries in southern Africa.
- U.S. stocks fell sharply on Friday as a new Covid variant found in South Africa triggered a global shift away from risk assets. The downward moves came after the World Health Organisation warned Thursday of a new Covid 19 variant discovered in South Africa. The new variant contains more mutations to the spike protein, the component of the virus that binds to cells, than the highly contagious delta variant. Because of these mutations, scientists are concerned that this variant may have increased resistance to vaccines. However, WHO said further research is needed.
- Asia-Pacific stocks slipped for the most part in early trading as investors continue to monitor developments related to the recently discovered omicron covid variant. Hong Kong-listed shares of Chinese tech giant Meituan lost more than 7% after the company reported a loss on Friday of about 10 billion Chinese yuan ($1.56 billion) for the three months ended Sept. 30. Shares in Hong Kong’s Sun Entertainment Group fell more than 40% after the South China Morning Post reported that major shareholder Alvin Chau Cheok-wa is part of a group arrested for alleged gambling offences.
In International news
Chinese tech giant Tencent to suspend launch of new apps
Tech giant Tencent has been ordered to halt the launch of new apps in China. The Chinese Ministry of Industry and Information Technology (MIIT) has also ordered a temporary suspension of updates for its products. This comes as the technology industry regulator reviews compliance with privacy regulations introduced this month. However, the current versions of the apps can still be downloaded and used as usual. The suspension of new app launches and updates is expected to last until the end of the year as they undergo technical testing by the regulator. “We are continuously working to improve the protective features of our apps and regularly engage with the relevant authorities to ensure compliance. Our apps are still functional and available for download,” Tencent said in a statement.
737 Max: Boeing dismisses new safety concerns
It has been called “the most scrutinised transport plane in history,” but some critics believe Boeing’s 737 Max is still not safe. U.S. regulators re-certified the plane for passenger service last year after it was grounded following two catastrophic accidents. Since then, however, a number of potentially serious problems have been reported with flights on the 737 Max. Boeing insists the plane is both safe and reliable. On October 14, a 737 Max took off from Seattle’s Boeing Field airport bound for Brussels. It was a delivery flight, with the brand-new plane scheduled to enter service for its owner, travel company Tui. But just minutes into the 5,000-mile journey, the pilots reported an urgent “flight control problem” and had to turn back. The plane landed safely shortly afterwards.