Global markets slumped Thursday, with the Dow sliding nearly 260 points as investors worried over emerging threats to the economic recovery, from a pandemic resurgence to labor market pressures.

On Thursday, Japan declared a state of emergency for Tokyo and said it would bar spectators from Olympic events held in and around the city as it tries to beat back a surge in coronavirus cases. Meanwhile, the more virulent delta variant has taken root in more than 100 countries, according to the World Health Organization, including those with high vaccination rates.

For investors, the developments served as yet another stark reminder that the pandemic is far from over. Asian markets closed mostly in the red, with Hong Kong’s Hang Seng Index shedding nearly 2.9 percent. European markets also fell sharply, with France’s CAC 40 index sliding 2 percent, the Pan-European Stoxx 600 dropping 1.8 percent and the German Dax losing 1.7 percent.

“Global markets have chosen today to price in the dawning realization that COVID isn’t nearly done damaging lives and economies,” Danni Hewson, a financial analyst with AJ Bell, said in commentary Thursday. “Case numbers are rising and it doesn’t matter how loudly politicians shout about ‘recovery’ and relaxation of restrictions there is a very real possibility that living with this disease will require a few more U-turns.”…

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Companies whose fates are heavily tethered to the recovery also saw their shares waver: Carnival stock was down 1.5 percent after recovering some ground, and United Airlines fell 1.3 percent. Big banks, such as JPMorgan Chase, and chipmakers Nvidia and Qualcomm also flashed red….