Asia-Pacific stocks drop as investors watch omicron Covid variant; oil prices rebound 4%

SINGAPORE — Shares in Asia-Pacific fell in Monday morning trade as investors monitor developments surrounding the recently discovered omicron Covid variant.

In Japan, the Nikkei 225 declined 1.17% in early trade while the Topix index shed 1.35%. South Korea's Kospi dropped 1.37%.

Shares in Australia slipped in morning trade as the S&P/ASX 200 fell 0.69%.

MSCI's broadest index of Asia-Pacific shares outside Japan traded 0.29% lower.

Elsewhere, U.S. stock futures moved higher following Friday's big sell-off, as investors stateside also watched for the latest developments related to the omicron variant.

Global markets tumbled late last week as the World Health Organization labeled the omicron Covid strain a "variant of concern." In Asia, the Nikkei 225 in Japan and Hang Seng index in Hong Kong both fell more than 2% on Friday.

Oil prices were higher in the morning of Asia trading hours.

International benchmark Brent crude futures were up 3.84% to $75.51 per barrel. U.S. crude futures gained 4.65% to $71.32 per barrel. On Friday, oil saw its worst day of 2021 amid renewed Covid fears.

Spot gold traded at $1,791.31 per ounce, having declined from above $1,800 late last week.

The Japanese yen, widely seen as a safe-haven currency, traded at 113.74 per dollar after strengthening sharply late last week from above 114.8 against the greenback.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 96.212 after a recent drop from above 96.4.

The Australian dollar changed hands at $0.714, having dropped last week from above $0.725.