It was an ugly day on Wall Street on Thursday as fears of a second coronavirus wave sent stocks plummeting.
All three major indexes had their worst day in three months.
The Dow Jones Industrial Average fell 1,862 points – a 7% drop. The Nasdaq was off 5% and the S&P 500 fell 188 points or 6%, putting it back into negative territory.
Travel stocks and major retailers, including Kohl’s and the Gap, took some of the biggest hits.
Analysts say investors may have driven the market artificially high in the past few weeks on hopes of a quick post-COVID economic recovery. A spike in coronavirus cases as many states and cities begin lifting lockdowns has those investors spooked.
But Treasury Secretary Steven Mnuchin told CNBC the U.S. economy will continue on the road to a full opening.
“We can’t shut down the economy again. I think we’ve learned that if you shut down the economy, you’re going to create more damage, and not just economic damage, but there are other areas,” he said, adding that more than a trillion dollars would be pumped into the economy over the next month.
President Donald Trump also tweeted Thursday that he believes the third quarter of the year will be “very good” and the fourth quarter “great” when, he says, he believes a COVID vaccine will be ready.
Major European indexes in London, Frankfurt and Paris were all down 4% or more Thursday while nearly every major Asian index also lost 1% or more.