U.S. stocks fell for the second day in a row on Wall Street after the head of the Federal Reserve, Jerome Powell, warned that prolonged shutdowns are likely to push the economy into recession.
World markets closed mostly in the negative territory Wednesday amid continued insecurity surrounding the coronavirus pandemic.
The Dow Jones Industrial Average was down 2.17% or 517 points, to end at 23,247.97.
The S&P 500 lost 1.75% or 50 points and closed at 2,820.
Nasdaq was down 1.55% or 139 points ending at 8,863.
European markets also posted losses in Wednesday trading
The FTSE in London closed with 1.5% loss, the DAX in Frankfurt lost more than 2.5%, and the CAC-40 in Paris is almost 3% lower.
Major Asian markets posted mixed results Wednesday: Tokyo lost 0.5, and Hong Kong fell 0.3%. Bombay gained a solid 2%. Australia, Shanghai and Taiwan also recorded gains.
In oil trading, West Texas Intermediate crude, the U.S. benchmark, traded at $25.51 per barrel, while the international benchmark, Brent crude, was selling at $29.32 per barrel.
Losses of oil revenue affect the global economy, and it is not clear when the demand may increase as people work and study at home and may not soon resume commuting and long-distance travel.
Powell said the U.S. government may need to pump additional aid into the economy, which cannot sustain jobs amid closures and decreased consumer spending. More than 30 million U.S. workers have filed unemployment claims since March.
The U.S. market has been wavering in the past weeks as traders’ optimism about reopening alternates with worry about the consequences of easing restrictions too soon.