Dow slips 650 points as spiking virus cases revive economic-recovery worries

• US equities slid on Wednesday as rising coronavirus case counts around the world fueled fresh fears of a slow economic recovery.
• COVID-19 cases have increased in California, Texas, and Florida, driving concerns about economic reopenings.
• Investors also braced for a new tariff announcement after a late-Tuesday notice said the Trump administration was mulling duties on $3.1 billion worth of European exports.
• Oil fell, with West Texas Intermediate crude sliding back below $40 per barrel at intraday lows.
• Watch major indexes update live here.

US stocks slid on Wednesday as surging COVID-19 case counts in the US fueled concerns of a protracted economic downturn.

California, Arizona, Texas, Florida, and other states have recently seen large coronavirus outbreaks, leading some to question whether economic reopenings will be extended or reversed. Rising case counts in Germany and China suggest economic pain will last abroad as well.

Investors also braced for a new tariff announcement from the White House. The Trump administration is mulling duties on $3.1 billion worth of exports from France, Spain, Germany, and the UK, according to a notice from the Office of the US Trade Representative published Tuesday evening. Such action could place fresh pressure on US trade relations and spark a new conflict.

Here's where US indexes stood at 1:20 p.m. on Wednesday:

• S&P 500: 3,058.14, down 2.3%
• Dow Jones industrial average: 25,511.58, down 2.5% (645 points)
• Nasdaq composite: 9,939.86, down 1.9%

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"I imagine there will be significant resistance to restrictions being reimposed but the fear is that they are left with no other option and the recent trends we're seeing in the data is a worry," said Craig Erlam, a senior market analyst at Oanda Europe.

Travel stocks were among the session's biggest losers. Airlines declined, led by Delta, Southwest, and United. Carnival Cruise Line and Royal Caribbean plunged further. Retailers including Gap and Macy's also declined.

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Oil fell amid concerns of prolonged demand weakness. West Texas Intermediate crude fell as much as 3.6%, to $38.90 per barrel. Brent crude, the international benchmark, slipped 3.6%, to $41.10, at intraday lows.

Wednesday's decline came after gains on Tuesday. Soaring tech names pushed the Nasdaq composite to a record high. Bank stocks followed close behind as investors received positive signs from new home sales data and IHS Markit's US purchasing managers' index.

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