U.S. stocks plunged nearly 13% Monday as fears over the potential health and economic impacts of the coronavirus pandemic drove panic selling.

The Dow Jones Industrial Average shed almost 3,000 points to end the day 12.93% down.

It was the worst single-day fall since the 1987 Black Monday crash and reportedly the third-worst day ever for stocks.

Illinois Gov. J.B. Pritzker announced Sunday that all restaurants and bars must close to dine-in customers for at least two weeks, starting Monday night. On Friday, Pritzker announced that all K-12 schools across the state would close from Tuesday through March 30.

Meanwhile, the Centers for Disease Control and Prevention updated its guidelines Sunday to recommend ending all gatherings of 50 people or more.

With more and more people hunkering down at home, economic activity is inevitably slowing – which only drives markets lower.

“There’s some panic and then there’s some probability that things get really bad,” said Steven Kaplan, a professor of entrepreneurship and finance at University of Chicago’s Booth School of Business. “There’s a ton of uncertainty and when there’s a ton of uncertainty there’s clearly some panic selling.”

The U.S. Federal Reserve’s decision to cut benchmark borrowing rates to zero along with launching a $700 billion round of quantitative easing on Sunday did little to bolster the market.

Kaplan said the Fed’s concern is to keep the financial system solvent and credit available. But he said it has little ability to try and boost economic activity at the moment.

“I think the Fed is limited in what it can do,” he said. “That’s where, on the fiscal side, you need the federal and state governments to step in … to provide food, tax (deferments) and various things that keep money in people’s pockets so that they can live until things start returning to normal.”

Kaplan said he is planning to temporarily get out of town because of concerns over the pandemic, particularly since older people are more vulnerable to the illness.

“I am going to go out to Michigan and lay low for the next week or so,” said Kaplan. “I’m 60 – I’m a little more nervous than if I were 40 – let’s put it that way.”

While some businesses such as the airline industry and the entertainment and hospitality sectors are likely to suffer major disruption – and likely bankruptcies and closures – others are better suited to ride out the crisis.

Kaplan noted that health care companies should be in a relatively good position because much of their income is derived from either insurance payments or the government. Technology companies such as Google and Facebook should also be able to function relatively normally, even if many of their employees work from home.

“They can operate remotely. The internet backbone still works,” said Kaplan. “Demand is actually a little higher.”

But businesses with the most exposure to the crisis are likely to need government help to survive. His hope is that the pandemic will only do short-term damage to the economy.

“I think you will see that it is going to be two to four terrible months and the government will step in and support consumption and support the businesses that are being really effected,” said Kaplan. “And then with any luck it passes and you have what you have in China where it is not gone but it’s slowly recovering.”

He said the simple fact that Republicans and Democrats in Congress are working together on some form of a bailout package for the economy and worst-hit businesses is a sign of how serious the crisis is – or could become.

“That’s a very good sign that people are treating this as if it is a war footing,” said Kaplan. “Italy really scared the heck out of everybody.”

Monday on “Chicago Tonight,” economists Edward Stuart, professor emeritus of economics at Northeastern Illinois University and Michael Miller, associate professor of economics at DePaul University join Paris Schutz to discuss the economic impact of the coronavirus.