Japan's Nikkei 225 was down about 1.6%, while Hong Kong's Hang Seng Index had dipped about 1% by 3.30 a.m. ET. China's Shanghai Composite was flat.
European markets opened higher, rebounding slightly from heavy losses on Friday, when the emergence of the Omicron variant shook global markets. In early trade, London's FTSE 100 index was up more than 1%, with the French CAC 40 and the German DAX seeing similar gains.
Oil prices were recovering, too. Brent crude, the global benchmark, was up more than 3% to $75 a barrel, and US crude jumped 4% to trade above $71.
"The next couple of weeks could be pretty nervy for markets," wrote Nohshad Shah, co-head of interest rates sales for Europe, the Middle East and Africa, at Goldman Sachs.
Analysts are bracing for evidence of how the Omicron variant could endanger more lives, disrupt the global economy and continue to affect markets after the dramatic sell-off on Friday.
"It should be stressed that at this stage we have very little laboratory evidence and very limited real world data," Shah said in a note on Saturday.
Fear of the unknown
The Omicron variant of the coronavirus has prompted a fresh round of travel restrictions across the world, including a ban by Japan on visits by all non-resident foreign nationals, and raised concern about what may be next in the pandemic.
The World Health Organization (WHO) has designated the strain as a "variant of concern" and said that multiple studies on it were underway. On Monday, it urged countries to accelerate Covid-19 vaccination efforts among eligible populations, and to "use a risk-based approach to adjust international travel measures in a timely manner."
In a technical brief, the WHO said the overall global risk related to the new Omicron variant "is assessed as very high." Further research is needed to understand its potential to escape immunity, the agency added, but despite the uncertainties, it is "reasonable to assume that currently available vaccines offer some protection against severe disease and death."
In a report Sunday, economists at Morgan Stanley said the emergence of the new strain posed "a near-term risk" to their outlook for Asia.
"However, with a much higher share of vaccinated population, the downside risk to growth could be less than what transpired in mid-2021, provided that the variant is not more challenging than Delta," they added, referring to the highly contagious Delta variant that was first detected earlier this year.
"To assess the Omicron variant's impact, we are watching for details on its transmissibility and impact on vaccine efficacy as well as on hospitalizations and mortality rates."
On Friday, stocks around the world fell as fear gripped global markets. Oil prices plunged more than 10%.
In the United States, the Dow plummeted 905 points, or 2.5%. The S&P 500 had its worst day since February, closing down 2.3%. For the Nasdaq Composite, it was the worst day since September. The index finished down 2.2%.
US trading ended around lunchtime on Friday, after markets were closed Thursday for Thanksgiving. Traditionally, the half-day session is lower in trading volume, which can exacerbate the swings in the market.
Dan Ives, managing director of equity research at Wedbush Securities, wrote in a note over the weekend that his team viewed the rout on Friday "as a clear buying opportunity."
"Ultimately this is not the first or last variant scare," he said.
-— Rob North, Anneken Tappe, Christina Maxouris and Laura He contributed to this report.
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