The FTSE 100 fell by nearly 1pc amid fears that omicron could slow the global recovery, as the US confirmed its first case of the covid variant.
American markets were buffeted by the news and Federal Reserve Chair Jerome Powell’s reiteration that officials should consider a faster reduction of monetary stimulus amid high inflation, with the Nasdaq falling by nearly 3pc overnight.
New travel restrictions are also set to be enforced in the US, with President Joe Biden due to make a speech today to announce the plans.
Biden to introduce new US travel restrictions
New travel restrictions are set to be enforced in the United States after the country’s first case of the omicron coronavirus variant was reported.
Tougher pre-flight testing for international arrivals could be introduced, with the potential for further testing on arrival and self isolation.
President Joe Biden is due to make a speech today to announce the plans. Biden previously said the US will continue its fight against the virus “not with shutdowns or lockdowns but with more widespread vaccinations, boosters, testing, and more.”
Under the current rules, anybody arriving into the US must take a viral test (such as a PCR) within 72 hours of boarding their flight. Health officials are expected to insist this time frame is squeezed to no more than 24 hours. Vaccinated Britons also now face tougher testing rules on their return home, when they must isolate until the result of a PCR test is confirmed, taken on or before day two.
Apple tells suppliers iPhone demand has slowed
The tech giant has told its component suppliers that demand for the iPhone 13 lineup has weakened, signaling that some consumers have decided against trying to get the hard-to-find item.
Apple had already cut its iPhone 13 production goal for this year by as many as 10 million units, down from a target of 90 million, because of a lack of parts, Bloomberg News reported.
The company is still on track for a record festive season, with analysts projecting a sales increase of 6pc to $117.9bn in the final three months of the calendar year.
The iPhone is Apple’s flagship product, accounting for about half of its $365.8bn in revenue during the last fiscal year.
Erdogan replaces finance minister as Turkish lira plummets
Turkey’s President Recep Tayyip Erdogan has abruptly replaced his finance minister amid deepening rifts in his administration over aggressive interest-rate cuts that have undermined the currency and fueled inflation.
Lutfi Elvan will exit after a little more than 12 months in the job and will be replaced with Nureddin Nebati. Mr Nebati, 57, has been a deputy finance minister since 2018 and is perceived to be close to former economy czar Berat Albayrak, a son-in-law of Erdogan.
Turkey’s lira, already trading near record lows, weakened after the announcement.
Recent central bank rate cuts the president had encouraged – at a time when inflation is already running close to 20pc – have punished Turkish assets as investors cast doubt on the unconventional approach to running the economy.
FTSE slides as omicron and inflation fears grow
The FTSE 100 is down as fears about the omicron variant spook investors, with the US confirming its first case of the new strain, while warnings about inflation from major central banks further added to the downbeat mood.
The drugmaker GlaxoSmithKline added 0.7pc after a pre-clinical analysis of the antibody-based COVID-19 therapy it is developing with American partner Vir indicated that the drug also works against the new omicron variant.
Johnson Matthey and Darktrace dropped 1.2pc and 1pc respectively after index manager FTSE Russell confirmed that the companies are set to leave the blue-chip FTSE 100 index.
Halfords rose 5.4pc after it said it would buy Axle Group for £62m as the cycle retailer shifts focus to its motoring services business.
GSK says tests show antibody drug works against omicron
GlaxoSmithKline has said that a lab analysis of the antibody-based covid therapy it is developing with American partner Vir has shown the drug is effective against the new omicron variant.
In a statement, the British drugmaker said that lab tests and a study on hamsters have demonstrated that the sotrovimab antibody cocktail works against viruses that were bio-engineered to carry a number of hallmark mutations of the omicron variant.
The Medicines and Healthcare products Regulatory Agency (MHRA) has today approved sotrovimab, also known under the brand name Xevudy, for people with mild to moderate covid who are at high risk of developing severe disease.
A statement by the MHRA said: “It is too early to know whether the omicron variant has any impact on sotrovimab’s effectiveness but the MHRA will work with the company to establish this.”
Selfridges owners close in on deal to sell department store
The department store Selfridges is in line to be sold to Thailand’s Central Group.
The Weston family have been searching for a buyer and want around £4bn for the retailer, which has 25 stores globally, including its flagship Oxford Street site as well as branches in Dublin, the Netherlands and Canada.
The business can trace its roots back to 1908, when it was founded by Harry Gordon Selfridge, and has been owned by the Westons for 18 years. The family also have a large stake in Primark.
The sale could drag on until the end of the year but terms were agreed in the last few days, report The Times.
Oil climbs from three-month low ahead of OPEC+ supply meeting
Oil clawed back some losses after plunging more than 6pc over the previous two sessions on nervousness over whether the rapid spread of the omicron variant will lead to more lockdowns and restrictions on movement.
Against this backdrop, the OPEC+ alliance will decide on their supply policy for January later today. With oil prices already in a bear market as omicron imperils demand, traders widely expect the producer group to defer a modest increase in output.
5 things to start your day
1) Teesside Covid jab factory gets £400m boost The Fujifilm Diosynth Biotechnologies plant in Billingham will see its workforce rise from 890 to 1,200 staff
2) Sadiq Khan fears defeat in crisis talks to stop the Tube going bankrupt London Mayor has until December 11 to reach a new funding deal
3) Anglo American plans to dismiss unvaccinated workers The demands will apply to all of its 95,000 employees worldwide and take effect early next year
4) Nissan turns to Sunderland sunshine to power electric car factory The group plans to build a solar farm to double the amount of green power it produces onsite
5) GB News and Donald Trump join forces on the comeback trail News channel senses a turnaround with big interview but viewing figures show there is still a long way to go
What happened overnight
Asian shares edged higher in choppy trading on Thursday, helped by advances in Chinese real estate shares, though fears about the omicron Covid variant capped gains regionally.
MSCI’s broadest index of Asia-Pacific shares outside Japan advanced 0.2pc, boosted by Chinese blue chips up 0.25pc and Hong Kong up 0.2pc.
Japan’s Nikkei lost 0.6pc, and all three main Wall Street benchmarks fell more than one per cent overnight as a global rally petered out as news about omicron turned negative.
Coming up today
Corporate: AJ Bell, Auction Technology (Full-year results); Go-Ahead Group (Trading update)
Economics: Producer price index (EU), unemployment rate (EU), jobless claims (US)