* U.S. indexes end sharply lower; banks, small caps take big
* All major S&P 500 sectors fall: energy down most
* Dollar down; gold up; crude, bitcoin collapse
* U.S. 10-Year Treasury yield falls to ~1.50%
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A FILM-NOIR FRIDAY (1305 EST/1805 GMT)
Darkness came over global stocks on Friday amid concerns
about a new and possibly vaccine-resistant coronavirus variant.
With this, travel, bank and commodity-linked stocks bore the
brunt of the selloff.
The Nasdaq Composite, S&P 500 and Dow Jones
Industrial Average were sent reeling. They all ended down
more than 2%.
All major S&P 500 sectors fell. Energy was
the weakest group falling 4%. This as NYMEX Crude Futures
, down more than 12%, took their biggest hit since April
And on this Black Friday, pessimism won out among retail
stocks. The SPDR S&P Retail ETF finished off 2.4%.
That said, it wasn't all totally grim. Some stocks that
benefit from people working from, or staying at, home,
Regarding Friday's action, Greg Bassuk, CEO of AXS
Investments said, “We see today’s activity and what will likely
spill over into next week as a buying opportunity in the sense
that it is another wrinkle here with the South African variant
but while the immediate term market slides could be significant
and continue into early December, bigger picture this will be a
buying opportunity to move in there on this dip.”
Here is Friday's closing snapshot:
(Terence Gabriel, Chuck Mikolajczak)
EUROPE: WORST SESSION SINCE JUNE 2020 (1153 EST/1653 GMT)
European stocks got their worst beating since June 2020 with
a 3.7% fall and the extent of the market turmoil had many
similarities with the March 2020 COVID-19 crash.
Travel and leisure stocks plunged a whopping 8.7%, a
performance unmatched since March 2020 with airlines stocks
being dumped in a dramatic fashion.
BA owner IAG fell about 15% after Britain banned flights
from South Africa and Ryanair lost 12%. Cruise operator Carnival
was the top loser with a 16% drop.
Many other countries are already putting in place travel
restrictions amid fears the new variant might be to some degree
With a new wave of social restrictions already being
implemented across Europe, investors are taking no chances.
The travel and leisure index is now down 6.6% since the
beginning of the year and has lost nearly 20% this month alone.
It's obviously not a good time to be building planes and
Airbus has fallen 11%.
Banks, which have become a barometer of the pandemic crisis
also had an excruciating day, losing 6.7%, their worst session
since June 2020.
But the pain was well spread and cyclical stocks across
other sectors such as car makers, miners, energy, insurance,
retail, construction and industrials fell between 4% and 6%.
There were little safe places to hide and even pharma, the
best performing sector today, lost 1.2%.
BEARS POKE THEIR HEADS UP (1137 EST/1637 GMT)
The percentage of investors with a bearish short-term
outlook for the U.S. stock market has risen to its highest level
since early October in the latest American Association of
Individual Investors Sentiment Survey (AAII). With this, both
bullish and neutral sentiment declined.
With these changes, the bull-bear spread fell to -1.90 from
+11.6 last week:
U.S. ON THE MAT (1056 EST/1556 GMT)
U.S. stocks are being tossed to the floor on Black Friday,
triggered by the discovery of a new and possibly
vaccine-resistant coronavirus variant.
Not surprisingly, given renewed coronavirus concerns, more
economically sensitive groups and "re-opening plays" are being
hit especially hard, while defensive groups see less severe
Banks and small caps are down more than 4%.
Energy is sliding nearly 6%, while NYMEX crude futures
are collapsing more than 11%.
The 10-Year U.S. Treasury yield has plunged to
the 1.50% area.
Healthcare is a bright spot as the only major S&P
500 sector up on the day, though just fractionally.
This chart shows action in a composite of five major
re-opening plays vs a composite of five major stay-at-home
As the re-opening group is hit relatively harder vs
stay-at-home plays, the ratio is on track for its biggest daily
percentage decline in more than a year.
Meanwhile, retail stocks are also down sharply on this Black
Friday. The SPDR S&P Retail ETF is off more than 3%.
Here is where markets stand in mid-morning trading:
U.S. STOCKS POISED TO PLUNGE (0900 EST/1400 GMT)
U.S. equity index futures are sliding on Friday, with
travel, bank and commodity-linked stocks bearing the brunt of
the selloff, as the discovery of a new and possibly
vaccine-resistant coronavirus variant, spooked investors ahead
of a short trading session.
Of note, over the past 10 years, the day after Thanksgiving
has been relatively quiet. On average, the Dow Jones Industrial
Average has opened down around 0.05% and ended the day
with a 0.05% gain. Over this period, the DJI's range on that
Friday as a percentage of the prior trading day's close has
averaged only around 0.6%.
As stands, the CBOE Market Volatility Index has
popped to a more than two-month high, and CBT e-mini Dow Futures
are suggesting the Dow will plunge more than 2% in the
early throes of this Black-Friday session. And at
more than 3%, the Dow Futures' range so far today as a
percentage of Wednesday's close is its biggest since early
All of this is occurring in the wake of pronounced technical
deterioration across the market. Click here:
Thus, based on the futures' action, the DJI's 50-day moving
average (DMA), which ended Wednesday around 35,260, can quickly
come under pressure. The Dow has not closed below this
intermediate-term moving average since October 13:
The DJI's 200-DMA ended Wednesday around 34,300. The
blue-chip average has not closed below this long-term moving
average since July 13, 2020.
A key support line resides around 34,000. Click here:
Here is your premarket snapshot:
FOR FRIDAY'S LIVE MARKETS' POSTS PRIOR TO 0900 EST/1400 GMT
- CLICK HERE:
(Terence Gabriel is a Reuters market analyst. The views
expressed are his own)