Coronavirus infections sweeping across the southern United States on Wednesday reawakened investor alarm that the stubborn disease might derail an economic recovery and slammed the breaks on stock market momentum.
The Dow Jones industrial average fell 709 points, or 2.7 percent, settling at 25,447 on the day after falling as low as 859.
The blue-chip index is still poised to post one of its best quarters in history, but remains down around 10 percent for 2020.
“Wishful thinking has given way to practical reality when it comes to Covid-19,” said Daniel P. Wiener, chairman of Adviser Investments.
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“Warm weather and a reduction in the rate of deaths does not give people the right to go out and party. They partied, the market partied and the hangover begins.”
The Standard & Poor’s 500 index fell 81 points, or 2.6 percent, to close at 3,050.
The broad index, like the Dow and Nasdaq composite, is on track for one of its best quarters in decades.
The S&P is down 5 percent in 2020. The Nasdaq, whose technology stocks have powered markets out of their spring depths, snapped an eight-day winning streak on Wednesday, falling from its all-time high.
The Nasdaq slid 222 points, or 2.2 percent., to close at 9,909. The sell-off was wide and deep, marking the steepest drop since June 11. Crude oil fell 6 percent. European indexes closed down 3 percent.
Even high-flying mega-tech stocks like Microsoft, Apple and Alphabet finished negative.
Energy, industrials, real estate and financials — industries tied to a reviving economy — led all 11 stock market sectors into the red as Florida, Texas and Arizona reported spikes in virus outbreaks.
Airline stocks dove after officials in New York, Connecticut and New Jersey announced 14-day quarantines on incoming travelers from virus hot spots.
