Traders work on the New York Stock Exchange floor on March 3, 2025.
Spencer Platt | Getty Images
The S&P 500 retreated on Monday, extending February's rout and turning red for the year after President Donald Trump's confirmation of forthcoming tariffs ratcheted up economic concerns.
The S&P 500 fell 2.1%, bringing its year-to-date performance to a loss of nearly 1%. The Dow Jones Industrial Average dropped 789 points, or 1.8%. The Nasdaq Composite slid 3%, weighed down by Nvidia's decline of more than 9%.
All three indexes traded higher earlier in the session, with the Dow at one point up nearly 200 points. Stocks took a notable leg down in afternoon trading following Trump's reiteration that 25% levies on imports from Mexico and Canada would go into effect on Tuesday, dashing investors' hopes of a last-minute deal to avert the full tariffs on the two U.S. allies.
"No room left for Mexico or for Canada," Trump said alongside Commerce Secretary Howard Lutnick from the White House. "Reciprocal tariffs start on April 2 ... but very importantly, tomorrow, tariffs, 25% on Canada and 25% on Mexico, ... will start."
Trump also signed an action to impose an additional 10% tariff on China, according to an administration official.
Dow intraday
A risk-off move ensued, hitting everything from technology to small caps. Beyond Nvidia, one-time popular artificial intelligence plays like Broadcom and Super Micro Computer also plunged. Elsewhere, the small cap-focused Russell 2000 dropped more than 3%.
Stocks set to take a direct hit from the tariffs or retaliation by the targeted countries also fell. GM and Ford hit their lows of the session after Trump's comments. Exchanged-traded funds from iShares tracking Mexico and Canada both fell.
"Whether the stock market can survive this change remains to be seen," Chris Rupkey, chief economist at FWDBONDS, said in a note. "One way or another, tariffs will be a shock for the economy."
Monday's sell-off to start March comes after the three major indexes notched losses for February, largely over fear of the impact of tariffs and early signs of a weakening economy. The Dow and S&P 500 each slipped more than 1% in February, while the tech-heavy Nasdaq Composite recorded its worst month since April 2024 with a pullback of 4%.
Soft economic data for the manufacturing and construction sectors released Monday offered the latest reasons for worry about the state of the U.S. economy. Those releases kick off a big week for economic data that will be capped by the February jobs report slated for Friday.
