MANHATTAN (CN) — The worst decline in U.S. GDP ever recorded caused markets to slough off gains from the previous day, even though the report was in line with most analysts’ expectations.

The big news of the day was the staggering drop in GDP during the second quarter. According to the Commerce Department, the United States saw a nearly 33% drop in GDP last quarter compared with the second quarter of 2019, the largest annualized contraction on record.

The report — as well as an ominous tweet by President Trump pondering whether the November election should be postponed — sent markets into a tizzy. The Dow Jones Industrial Average fell more than 500 points just after the opening bell, then slowly climbed back up to finish 223 points down, a 0.8% decrease. The S&P 500 and Nasdaq had similar trajectories, though the Nasdaq was able to crawl out of the hole to end the day up 0.4%.

On a quarterly basis, GDP fell by 9.5% from April to June 2020. Commerce officials blamed consumption drought due to the stay-at-home orders in the spring for causing most of the 10.6% shrink of the U.S. economy in the first half of the year.

“The true decline between mid-March and the end of April when the lockdowns were at their most intense was likely much greater, possibly even double the 10.6% figure, given evidence of a sharp bounce-back in consumer activity through May and June,” the agency said.

Positives were slim: Government spending increased by 2.7%, and net exports were slightly higher.

There is no comparable data on quarterly GDP contraction from the Great Depression. The next largest drop was in 1958, when the GDP fell 10%. During the Great Recession, GDP fell by 6.3% annualized in the fourth quarter of 2008.

The longest economic expansion on record — from 2009 through early 2020 — is now long gone, with many of those gains swept off the books.

“With virus fears on the rise, jobs being lost and incomes squeezed, we feel the recovery could be much bumpier than markets seemingly do, and think we are in for some data disappointment over the next couple of months — starting with next week’s payrolls number,” wrote James Knightly, chief international economist for ING.

Some experts cautioned that the huge drop was expected — as will be a similarly large rise in GDP next quarter that shows business conditions improving as lockdowns ended in June and July.

“This is hopefully the last negative quarter we’ll see for GDP,” wrote Jason Furman, an economics professor at Harvard University. “But absent swift and substantial action, the 5.6% decline (annual rate) in state and local spending could just be the beginning.”

The drop in GDP has put even more pressure on Congress to get a fourth stimulus package signed.

“The staggering news of the historic decline of the gross domestic product in the second quarter should shock us all,” U.S. Chamber of Commerce Chief Policy Officer Neil Bradley said in a statement. He noted the decline “should compel Congress to move swiftly” on both authorizing unemployment benefits and funds to state and local governments, as well as liability protections for businesses.

Others agree. “The only way you have personal income rising in a collapsing economy is if you turn to a massive welfare economy,” wrote Joel Naroff of Naroff Consulting. “That was absolutely necessary, and if it didn’t happen the [GDP] decline might have been 50% or more.”

Congress is still debating the $1 trillion stimulus package proposed by Republicans, though Treasury Secretary Steven Mnuchin said on Wednesday that the two political parties were far apart in negotiations.

One of the main sticking points is the proposed legal liability safe harbor for businesses affected by Covid-19. Senate Majority Leader Mitch McConnell has said the safe harbor is nonnegotiable, warning that medical providers, nursing homes and restaurants face a “wave of lawsuits” over the virus.

Democrats and consumer advocates meanwhile call the move a boon to negligent companies. “This law is not about protecting nursing homes that were unable to obtain necessary supplies because of Covid,” said Sam Brooks, project manager at Consumer Voice, a nursing home watchdog group. “It’s about protecting bad actors.”

According to data compiled by Johns Hopkins University, more than 17 million people have been infected by Covid-19 worldwide, while 668,000 have died. More than 4.4 million Americans have contracted coronavirus, while nearly 151,000 U.S. deaths have been attributed to the virus.

On Wednesday, Florida, North Carolina and California all set records for the highest number of coronavirus-related deaths in a single day, according to The Washington Post.

Lost in the noise of the GDP data was that new unemployment claims once again increased. For the week ending July 25, 1.4 million new claims were filed, compared with 12,000 fewer claims filed during the previous week. While the weekly claims are a far cry from the massive numbers filed in late March, they are still incredibly high.

Last week’s unemployment report marked the first increase in weekly jobless claims in three months.

Continuing claims — a tally of those who remain on unemployment, which is a week delayed — also continued to rise, gaining 867,000 the week ending July 18. This marks the first gain in continuing claims since the end of May.

Jobs once thought recession-proof could soon be lost, some economists warn. Researchers at the Federal Reserve Bank of St. Louis found there was no noticeable change in employment among college and professional schools during the recessions of 1990-91, 2001 and the Great Recession of 2007-09.

This time could be different, however, as social distancing has taken its toll on higher-education employment. “By June, employment figures bounced back,” the researchers wrote, “but as the recession and pandemic continue, employment in the education sector may decrease again.”