With the holiday season getting underway, many were expecting the global economy to move on from the pandemic and start getting back to normal.
But with the discovery of the Omicron COVID-19 variant the global economy might take yet another hit.
For more on the potential economic impact of Omicron, we have our business correspondent Eum Ji-young here in the studio.
Good Evening Jung-min.
Earlier last week, retail analysts were anticipating a bumper holiday shopping season and stock markets had been doing well particularly in the U.S. hitting new highs.
But major financial markets tumbled when news emerged about the Omicron variant.
Right Jung-min. Last Friday was a pretty scary day for investors.
All three U.S. major indicies took a hit as the news that suggested Omicron could spread faster than other strains sent traders into a selling frenzy.
At the close of trading on Black Friday, the Dow Jones Industrial Average posted its worst day of the year, plummeting around 905 points or 2.5 percent from the previous day.
The broad-based S&P 500 dropped by 2.3 percent and the tech-dominated Nasdaq Composite was down by more than 2.2 percent.
On Monday, the stocks recovered some of the ground lost with President Biden's remarks saying he does not expect to impose lockdowns in response to the Omicron variant.
"This variant is a cause for concern, not a cause for panic. I'll be putting forward a detailed strategy outlining how we're going to fight COVID this winter. Not with shutdowns or lockdowns, but with more widespread vaccinations, boosters, testing and more."
But, amid concerns over whether the current vaccines can control Omicron, global markets were sliding again on Tuesday.
All three major indexes closed sharply lower, reversing Monday's rebound.
The Dow Jones Industrial Average fell more than 650 points or 1.9 percent compared to the previous session's close.
The S&P 500 also shed 1.9 percent and the tech-heavy Nasdaq dipped about 1.6 percent.
European stocks also closed lower on Tuesday with travel and leisure stocks leading the losses.
And Federal Reserve Chairman Jerome Powell also made some comments on the Omicron variant?
Yes you are right. His remarks suggesting an earlier end to bond tapering also contributed to the drop in stocks.
"The recent rise in COVID-19 cases and the emergence of the Omicron variant pose downside risks to employment and economic activity and increased uncertainty for inflation."
He added the variant will make people less willing to go to work in person, which in turn will slow down the labor market recovery and further disrupt supply chains.
Powell said there will be more information available on the Omicron variant in the next two weeks.
An analyst suggested that investors pulled back as there is not enough information available about the variant to make a concrete call on the path forward.
"We really only know so far that it's pretty transmissible and that it has a lot of mutations. But that doesn't necessarily mean it's going to be more deadly than previous variants. It doesn't necessarily mean that we'll see more lockdowns and more economic damage. Right now, that's what the markets, economic and financial markets are trying to figure out."
Major Asia-Pacific markets also dropped amid fears over the Omicron variant.
South Korea's benchmark stock index erased its 2021 gains.
Right. There was a broad sell-off as investors remained concerned over the Omicron variant.
South Korean shares hit their lowest in nearly 11 months on Monday and they extended losses on Tuesday.
"Recently, the Omicron variant has been a concern as it could spread faster than the Delta variant and it could make antibodies and vaccines useless. It has emerged as the biggest uncertainty issue and the country's benchmark has recorded its lowest figure of the year. There is a possibility that it might go even lower in the near future."
With Moderna's CEO saying existing vaccines might be less effective against the Omicron strain, South Korea's benchmark KOSPI plummeted 2.4 percent to close at 2,839 on Tuesday.
It was down about 14 percent from its July 6 peak.
Also, the closing was at its lowest level in the whole of 2021.
Another expert says stocks could fall even further due to the Omicron variant but the impact will not be as dramatic as March 2020 when the global economy was basically frozen.
And he said that until more information is revealed about the Omicron strain, people will prefer investing in relatively stable assets like bonds and gold rather than risky assets as uncertainty will remain in the stock market at home and abroad.
"Although a certain level of contraction in economic activity will be inevitable due to the variant, the impact on the stock market will be much smaller than that of March last year because people are already used to tackling the pandemic. But as the restrictions on economic activities prolong, the uncertainties in the stock market will remain."
The Omicron variant has caused dozens of countries to impose travel restrictions.
Could the variant hurt the South Korean government's goal of 4 percent economic growth this year?
Well, an expert says, because there's only one month left this year, Omicron's impact on the South Korean government's goal of 4 percent economic growth would not be significant.
"There's only one month left this year so there's little chance that the economic growth rate this year will fall sharply. Although it could affect the growth rate of early next year, it will not plummet because consumer spending is not likely to contract drastically due to the spread of the variant."
But she added that if stricter social distancing measures are imposed at home and there are lockdowns globally, it could hurt the country's economic growth.
Economists at Goldman Sachs also said if both immunity against hospitalizations and disease severity are much worse than for Delta, there could be a substantial blow to global economic growth.
But they also said that if leads to a milder illness than the Delta variant, it could in turn be a positive case for stocks with eased restrictions and quicker comedown in inflation.
And others say Omicron could only be a 'short-term' disruption.
"We think there will be increasing numbers of variants. They'll come up randomly, unexpectedly in different parts of the world, and it will be very difficult to stop them from spreading even if governments try to shut down travel between countries, we think that this will be a short-term disruption for the economy and for the markets, especially in the northern hemisphere. "
He added that "with new vaccines coming out, as well as antiviral pills that should reduce the severity of any variants in the future, this will be a short-term disruption for the economy and for the markets."
Ji-young, thank you for the thorough reporting today.