LONDON (Reuters) – World stocks and oil prices were faltering on Friday as record-setting new coronavirus cases in several U.S. states led to worries that more lockdowns may be necessary, making a quick economic recovery unlikely.

The upcoming second-quarter earnings season, expected to be the worst for Europe and the United States since the 2008/09 financial crisis, added to the woes, pushing investors to chase safe-haven assets, such as U.S. Treasuries and the yen.

European stocks declined 0.3%, taking cues from Asia, where China ended its rally. Shares in China fell 1.8% from a five-year high, as state media discouraged retail investors from chasing the market higher.

MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1.3%. Australian stocks declined by 0.6% as an extension of loan-payment deferrals hit the banking sector. Japanese stocks were down by 1.1%.

The e-mini futures for the S&P 500 erased early gains to trade down 0.6%.

More than 60,500 new coronavirus infections were reported across the United States on Thursday, the largest single-day tally of cases by any country since the virus emerged late last year in China.

Graphic: Stocks, oil and coronavirus cases here

“The sharp increase in confirmed cases has led to growing concerns that a return to broad lockdowns lies ahead,” Goldman Sachs wrote in a note. “While lockdowns can slow down virus spread effectively, they come at very high economic cost.”

Some Asian cities that had appeared to have contained the disease, such as Tokyo, Hong Kong and Melbourne, have also seen a spike in cases, prompting investors to take shelter in safe-haven assets.

In the currency market, the yen rose 0.4% against the dollar and 0.5% versus the euro. U.S. Treasury yields dipped to their lowest levels since late April.

Gold was the only safe haven that didn’t join the rush-for-safety party, sliding 0.3%, a day after hitting an eight-year high.

While economic data continued to improve, with the number of Americans filing for jobless benefits dropping to a near four-month low last week, investors remained cautious. A record 32.9 million people were still collecting unemployment checks.

On Thursday, the Dow Jones Industrial Average fell 1.39% and the S&P 500 dropped 0.56%, but the tech-heavy Nasdaq rose 0.53% to its fifth record closing high in six days.

In other moves, the Australian and New Zealand dollars, which are often traded as a liquid proxy for risk because of their close ties to China’s economy, both fell against the greenback.

The Aussie also fell as local officials use lockdowns and border restrictions to contain a sudden increase in coronavirus cases.

U.S. crude oil fell 2% to $38.81 a barrel and Brent crude fell 1.7% to $41.63 per barrel amid concern about a long-term decline in global energy demand.

Graphic: World FX rates in 2020 here

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