WASHINGTON (Reuters) – Asian stocks were set to dip on Thursday after a choppy Wall Street session as spiking coronavirus cases and prospects of new lockdowns erased earlier confidence about a global economic recovery.

Optimism about a quick economic comeback has been tempered by more global cases of the coronavirus, with an outbreak in Beijing and a rising infections in U.S. states that are reopening their economies.

“A cautious tone has re-emerged in markets amid a quiet night for data,” Tapas Strickland, a director at the National Australia Bank, said in a note. “Markets are still trying to grapple with the implications of rising coronavirus infections and hospitalization rates in the southern parts of the U.S. given there is a high bar to re-impose lockdowns.”

Australian S&P/ASX 200 futures YAPcm1 were down 0.6%, while Japan’s Nikkei 225 futures NKc1 were off 0.02%.

Hong Kong’s Hang Seng index futures .HSI .HSIc1 were down 0.23%.

U.S. Treasury yields edged lower and crude prices fell on concerns over the fresh outbreaks, but drew some support from stimulus measures and positive tests of a drug trial for dexamethasone that could save some critically ill COVID-19 patients.

The dollar rose from early lows as investors wary of wider geopolitical risks sought its relative safety, but pared gains by the session’s end.

Rising tensions between North Korea and South Korea spurred demand for safe-havens, as did clashes between Indian and Chinese troops at a disputed border site.

“This can all change as the market is very sensitive to headline risk,” said Brian Battle, the trading director Performance Trust Capital Partners in Chicago.

“Don’t confuse lack of volatility with stability. The market is very unstable with news of the virus outbreak worsening, which could lead to less global trade. But news of no second coronavirus wave in the U.S. could lead to a smoother recovery.”

On Wall Street, The Dow Jones Industrial Average .DJI fell 0.65% while the S&P 500 .SPX lost 0.36%.

Both U.S. indexes opened modestly higher, waffled throughout the morning and turned positive in afternoon. By the final hour of trading, however, both indexes had slipped.

The Nasdaq Composite .IXIC, which continued to trade higher before paring its gains, added 0.15%, by the closing bell.

The pan-European STOXX 600 index closed up 0.74% while emerging market stocks rose 0.48%.

Oil prices swung in and out of the red amid an increase in U.S. crude inventories.

The dollar index =USD rose 0.11%, with the euro EUR= down 0.05% to $1.1237. The Japanese yen strengthened 0.06% versus the greenback at 106.91 per dollar, while Sterling GBP= was last trading at $1.2547, down 0.06% on the day.

Benchmark 10-year notes US10YT=RR yielded 0.7331%, from 0.733% late on Wednesday. The 10-year German Bund DE10YT=RR rose 0.7 basis point to yield -0.418. [GVD/EUR]

U.S. crude CLc1 recently fell 0.55% to $37.75 per barrel, while Brent LCOc1 was flat on the day.

U.S. gold futures GCcv1 gained 0.05% to $1,730.00 an ounce.

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