The safe-haven yen rallied and the South African rand tumbled on Friday as investors turned cautious after Britain raised the alarm over a newly identified coronavirus variant spreading in the African nation.

MADRID (Reuters) -Iberia airline's chief commercial officer said on Thursday the Spain-based company was now more pessimistic than optimistic about the acquisition of its rival Air Europa after the latest regulatory setback in the half-billion-euro takeover bid.

Stocks fell and headed for their largest weekly drop in nearly two months on Friday, while safe haven assets such as bonds and the yen rallied as a new virus variant added to swirling concerns about future growth and higher U.S. interest rates.

British retailers reported the strongest pre-Christmas demand since 2015 this month but also the biggest price rises since 1990, as fears of shortages led shoppers to buy gifts early, figures from the Confederation of British Industry showed.

British car output fell by an annual 41.4% last month to its lowest October level since 1956 as the global lack of semiconductor chips and a plant closure hit the sector, according to a trade industry body.

The European Union has moved a step closer to its vision of creating a single capital market across the bloc, a slow moving process but one that is chipping further away at Britain’s status as Europe's investment banker.