The world’s faltering effort to contain the coronavirus outbreak led to a rout in stocks and crude oil on Monday, as new cases surfacing across the globe amplified fears of a downturn. Each of the three major indices dropped more than 7% by market close, with the Dow shedding more than 2,000 points.

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The decline marked the largest one-day point loss for the Dow on record, and the largest single-session percentage hit since 2008. The S&P 500’s more than 7% drop was also the most since December 2008, led by stunning declines in the Energy and Financial sectors.

Worldwide cases of COVID-19 have topped 109,000 — with Italy emerging as the worst-hit country outside of China and the biggest in Europe, as new infections rise in the U.S. The Italian government’s move to quarantine its entire northern region raised new fears about the pathogen becoming a global pandemic, sending markets into a free-fall.

A grim offshore trading session turned into a full-fledged rout as equities sold off — which even a brief “circuit-breaker” trading halt couldn’t staunch. In the bond market, the benchmark U.S. 10-year Treasury interest rate fell to a new all-time low, with the entire yield curve falling below 1% during Monday’s session.

Brent crude (BZ=F) prices collapsed, falling by more than 30% on Sunday evening in what was the largest single-day drop since the U.S. invaded Iraq in 1991. Prices for Brent and West Texas intermediate crude oil each settled lower by more than 20% Monday.

OPEC’s failure last week to strike a deal to cut production prompted Saudi Arabia to lean in aggressively on cheaper oil prices, which fanned concerns about a full-fledged price war that sent oil into free-fall. Investors appeared to price in the likelihood that Saudi Arabia’s fight with Russia over market share will worsen the dramatic spiral lower in prices, taking place against a backdrop of falling demand and plentiful supply.

The coronavirus epidemic has stoked fears of a sharp global downturn, which have in turn weighed heavily on major benchmarks and crude (CL=F).

Most economists estimate that cheaper oil translates into lower gasoline prices, which act as a de-facto tax cut for consumers.

Yet with the COVID-19 epidemic creating supply shocks and forcing business activity to grind to a halt, analysts don’t see much to cheer about in the current price action.

“There's always winners and losers in any market, but right now the idea that lower gasoline prices is going to put more cash in workers' pockets and give consumer spending and the economy a boost doesn't seem to cushion the blow for stock market investors,” wrote Chris Rupkey, MUFG’s chief financial economist, in an email on Sunday evening.

“They want out. Big time. The sky is falling,” he said.

View photos Traders follow financial markets at the Dubai Stock Exchange in the United Arab Emirates, on March 8, 2020. (Photo by GIUSEPPE CACACE / AFP) (Photo by GIUSEPPE CACACE/AFP via Getty Images) More

Other analysts agreed that lower oil prices ultimately represent a downside risk to the domestic economy.

“Lower oil prices used to be an unambiguous positive for the U.S. economy as a significant net oil importer with energy consumption dominating over any domestic production,” Morgan Stanley economist Robert Rosener said in a note Monday. “But with gains in the domestic energy industry over this cycle, that relationship has grown to be increasingly balanced.”

While declining oil prices might add billions in disposable income to consumers’ wallets, the simultaneous concerns stemming from the COVID-19 outbreak will ultimately leave consumers hesitant to spend, Rosener said.

“A more cautious consumer in the current environment is likely to pare down the upside effect from lower oil prices in the near-term,” he added.

Analysts are also nervously eyeing U.S. shale producers, which are expected to suffer as cheap oil makes it unprofitable to churn out more supply. Most have financed expansion via debt, fueled by cheap credit.