U.S. stocks buckled again after Donald Trump’s latest trade-war salvo against Canada, with the S&P 500’s three-week rout now at 10% and megacap technology resuming a selloff that’s wiped out trillions in value.

The S&P 500 lost another 1.5% Tuesday, while the Dow Jones Industrial Average slid 1.7%. Selling was broad, with more than 400 S&P stocks lower. Energy, materials and industrials shares bore the brunt of selling on the headlines that Trump was ramping up tariffs on metals from Canada. A slew of poor earnings outlooks from airlines and consumer stocks added to the downdraft. The Cboe Volatility Index spiked above 29 amid the turbulence. The Nasdaq 100 fell 1.2%.

Trump said he was increasing the steel and aluminum tariff on Canadian goods to 50% to retaliate against Ontario’s move to place a levy on electricity imported from the U.S. The tariffs are expected to take effect Wednesday. Trump said he would also “substantially increase” other tariffs on Canada on April 2 if the country does not drop tariffs on dairy products and other U.S. goods.

The threats come after Trump’s on-again, off-again trade policies have sent measures of consumer and business sentiment sliding amid growing anxiety the American economy will slow, if not fall into a recession.

“Another day, another tariff announcement,” said Ryan Grabinski, Director of Investment Strategy, Strategas Asset Management, LLC. “The same way it’s going to be hard for consumers to make big ticket purchases or businesses to make capital investment decisions, its going to remain difficult for investors to step in and decisively buy until we start to see some of the positives that were largely expected from the Administration.”

Trump is slated to address top chief executives and Wall Street bank leaders later Tuesday in Washington, amid growing unrest that the president’s policies have upended the business environment to an extent that threatens growth and investment. Data Tuesday showing U.S. job openings rose in January, indicating steady demand for workers, temporarily boosted labor-market sentiment, though the data is somewhat dated.

The ongoing uncertainty over tariffs and government job cuts pushed the S&P 500 to its worst day of the year Monday, after it notched one of its worst weeks this century relative to the rest of the world last week.

“We haven’t seen a climax of fear and selling yet,” said Scott Colyer, chief executive at Advisors Asset Management. “We’re probably close, but we need to see the sellers done before we can bounce.”

The latest leg down in what is now a three-week market selloff came as strategists continue downgrading their view of U.S. equities. Citigroup Inc.’s were the latest to weigh in, lowering their rating on U.S. stocks to neutral from overweight. That lukewarm take is over the next three to six months, strategists including Dirk Willer wrote in a note, adding that more negative U.S. data prints are expected.

The view from Citi echoes that at HSBC Holdings Plc, where strategists cut U.S. equities to neutral on Monday, saying they see “better opportunities elsewhere for now.” Ned Davis Research strategists made a similar move last week, citing souring momentum.

“U.S. exceptionalism is at least pausing” for the coming few months, the strategists wrote. “The news flow from the U.S. economy is likely to undershoot the rest of the world in coming months,” they added.

Former Treasury Secretary Lawrence Summers said there’s almost a 50-50 likelihood of the U.S. tipping into a recession this year.

Market forecasters at banks including JPMorgan Chase & Co. and RBC Capital Markets have also tempered bullish calls for 2025 as Trump’s tariffs stoke fears of slowing economic growth. The S&P 500 has dropped 4.5% this year, and investors are questioning the lofty valuations of big technology shares.

The tech-heavy Nasdaq 100 has slumped into a correction, falling 13% from its February peak as investors dumped the sector that propelled the stock market over the past two years. The index is now the most oversold since 2022 and has broken below its 200-day moving average. But that threshold has not proved a sure sign of a recovery in the past.

Morgan Stanley’s Michael Wilson warned of a volatile path ahead as the market continues to contemplate growth risks, which could get worse before they get better.

The U.S. government has said that the economy faces a “transition” and is in need of a “detox,” creating uncertainty about the path for growth. Market participants are awaiting a so-called “Trump put,” something Treasury Secretary Scott Bessent said doesn’t exist.

That’s pushing attention back to the Federal Reserve as weaker macroeconomic data continues to roll in. Money markets are now anticipating about 80 basis points of rate cuts by the end of 2025, up from only about 40 basis points just a month ago.

There is at least one tracker of tech stocks that suggests the bout of selling may have reached a peak. Volume on the Nasdaq 100 ETF Invesco QQQ Trust Series exceeded 75 million shares on Monday, a threshold that was indicative of a bottom in the previous three occurrences over the past 20 months.

“We’re clearly in a correction and corrections usually need something to convince people of the reversal,” Dan Greenhaus, Chief Strategist at Solus Alternative Asset Management, said.

(With assistance from Henry Ren, Abhishek Vishnoi and Macarena Muñoz.)

©2025 Bloomberg L.P. Visit bloomberg.com. Distributed by Tribune Content Agency, LLC.