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(Bloomberg) — U.S. stocks tumbled the most in 12 weeks as the torrid surge in equities came to a screeching halt amid economic jitters. Treasuries surged with the dollar.

The S&P 500 sank almost 6%, approaching the 7% threshold that would trigger an exchange-mandated trading pause. Only one company in the index — supermarket operator Kroger Co. — finished higher. Losses in the Dow Jones Industrial Average were even deeper, with the blue-chip gauge plunging as much as 7.1%. Airlines, cruise and travel shares that soared in recent weeks bore the brunt of the selling. The KBW Bank Index of financial heavyweights slid 9%, and energy producers joined a rout in oil.

While much of the equity selling owed to the frantic pace of the recent rally, sentiment did sour as signs mounted that a possible second wave of the pandemic could be taking hold in some states. U.S. jobless claims remained high, underscoring the longer-term challenges caused by the pandemic. The report came out a day after the Federal Reserve provided a dour economic outlook. Treasury Secretary Steven Mnuchin said the U.S. shouldn't shut down the economy again even if there is another surge in coronavirus cases.

"The move from the bottom in terms of the rally has been so mind boggling. Over the new few weeks, we could see some pullback," said Solita Marcelli, deputy Americas chief investment officer at UBS Global Wealth Management. "That's mostly the fears of second wave concerns going higher, also we had the Fed yesterday. Their assessment of the economy was a little bit weaker than what the market expected."

As restrictions are lifted across the country, signs of a second wave of cases have been raising alarms. More than 2 million people in the U.S. have been infected so far. The localized surges have raised concerns among experts even as the nation's overall case count early this week rose just under 1%, the smallest increase since March.

"Sentiment has become much more cautious," said Shawn Cruz, senior manager of trader strategy at TD Ameritrade. "We actually started to get data that indicated reopenings are going extremely well, and now we're starting to get some of the headlines that maybe the reopenings are going to at least pause."

These are some of the main moves in markets:

Stocks

• The S&P 500 sank 5.9% as of 4 p.m. New York time.
• The Stoxx Europe 600 Index slumped 4.1%.
• The MSCI Asia Pacific Index fell 2.1%.

Currencies

• The Bloomberg Dollar Spot Index surged 1.2%.
• The euro decreased 0.7% to $1.1293.
• The Japanese yen appreciated 0.2% to 106.88 per dollar.

Bonds

• The yield on 10-year Treasuries decreased six basis points to 0.67%.
• Germany's 10-year yield dipped eight basis points to -0.41%.
• Britain's 10-year yield sank seven basis points to 0.198%.

Commodities

• The Bloomberg Commodity Index fell 1.4%.
• West Texas Intermediate crude decreased 8.7% to $36.17 a barrel.

–With assistance from Adam Haigh, Yakob Peterseil, Todd White, Nancy Moran and Sophie Caronello.