The Dow Jones Industrial Average index closed the day’s trading with a plunge of 1,861.82 points, whereas the S&P 500 and Nasdaq indices dove by 188.04 points and 527.62 points, respectively.
Thursday’s closing figures marked the Dow’s biggest one-day drop since March 18, when the index plummeted by 1,338.46 points despite the Trump administration’s efforts to put together a stimulus plan to ease economic concerns brought on by the COVID-19 pandemic.
The New York Stock Exchange saw companies in the travel and airline industries continue to take hits, with stocks belonging to United Airlines and Southwest Airlines dropping over 9% and share prices for the Carnival Corporation and Norwegian Cruise Line Holdings falling by more than 14%.
However, travel and airline firms weren’t the only ones to take an economic blow. Neither banks such as Goldman Sachs and Bank of America nor manufacturers like construction machinery and equipment company Caterpillar were able to avoid the pain on Thursday. All three saw shares dive by more than 6% during the day’s trading.
Elsewhere, European and Asian stock markets didn’t fare any better. The major indices all fell into negative territory over fears of a second COVID-19 wave and after the US Federal Reserve issued an economic forecast that suggested the US economy would contract by 6.5% this year before expanding by 5% in 2021.
Dan Deming, managing director at investment company KKM Financial, told CNBC Thursday that the market’s downturn suggests that “maybe the market got ahead of itself” and anticipated a quick economic recovery after COVID-19-related lockdown measures began to be lifted.
“You’re seeing the psychology in the market get retested today,” he said. “The reality is this thing’s going to linger longer than probably the market had [thought] of.”
Adding onto the downward spiral, the 10-year US Treasury note yield dropped to 0.67%, and oil prices slumped by over 7%.
US Surpasses 2 Million COVID-19 Cases
Thursday’s downfall came on the heels of new data that revealed the US has confirmed more than 2 million COVID-19 cases, and that more than 113,000 deaths from the disease have been recorded in the Land of the Free, according to the latest figures provided by Johns Hopkins University.
At least 20 states from Florida to California have reported seeing increases in COVID-19 cases after having eased restrictions initially imposed to stop the spread of SARS-CoV-2, the virus that causes COVID-19.
Bill Miller, a doctor and senior associate dean for research at Ohio State University’s College of Public Health, told NPR that the lifting of COVID-19-related restrictions was ultimately giving Americans a false sense of security.
“As places have been opening up, many people are taking it as a message that everything is OK and back to normal,” he said. "I'm definitely worried that we're going to see some upswings, maybe not everywhere, but in many places across the country."
All 50 US states began lifting restrictions in May.