(Bloomberg) — U.S. stocks plunged as much as 3.2% as investors grew anxious that the resurgence in virus cases in multiple states will hamper the economic recovery. Yields on Treasuries fell and the dollar strengthened.All 11 sectors in the S&P 500 sank at least 1.6%, with energy and real estate down more than 3% after data showed Florida set another daily record for new cases, Houston said its intensive-care unit beds are at 97% capacity. Travel stocks and other companies that had been climbing amid reopening optimism got hammered with New York, New Jersey and Connecticut requiring visitors from virus hot spots to self-quarantine. Even the tech-heavy Nasdaq Composite was lower for the first session in nine.“All the hopes of investors looking for a better economy to improve the bottom lines of companies shut down in the recession have been dashed,” said Chris Rupkey, chief financial economist at MUFG Union Bank.Market sentiment is rapidly turning more negative on concern that the spreading coronavirus could force policy makers to slow the pace or reverse business re-openings. At the same time, there’s the potential for trade tensions to resurface between the European Union and the U.S.The White House is weighing new tariffs on $3.1 billion of exports from France, Germany, Spain and the U.K. The American Trade Representative wants to impose new tariffs on European exports like olives, beer, gin and trucks, while increasing duties on products including aircrafts, cheese and yogurt, according to a notice published late Tuesday evening. The EU is also debating whether to keep the door shut to American travelers this summer.Elsewhere, the International Monetary Fund downgraded its outlook for the world economy, projecting a significantly deeper recession and slower recovery than it anticipated just two months ago.Crude oil slid below $40 a barrel in New York and gold traded around $1,770 an ounce.“What we’re seeing so far this month is likely what we’re going to see a lot more of, which is volatility,” said Jeffrey Kleintop, chief global investment strategist for Charles Schwab & Co. “The market has already priced in the good news, it’s now increasingly concerned about some of these threats to the recovery.”Here are some key events coming up:U.S. jobless claims, durable goods and GDP data are due Thursday.A rebalance of Russell indexes is due on Friday.These are the main moves in markets:For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
