US stocks tumbled in afternoon trading on Tuesday and ended sharply lower, with the S&P 500 narrowly avoiding a bear market after the White House said it plans to move forward on a threat to bring t he overall tariff rate on China to 104%. That tariff rate will go into effect at 12:01 a.m. ET.
The benchmark S&P 500 ( ^GSPC ) and tech-heavy Nasdaq Composite ( ^IXIC ) each reversed gains of over 4% to fall around 1.6% and 2.2%, respectively. The Dow Jones Industrial Average ( ^DJI ) slid roughly 0.8%, falling just over 300 points. Earlier in the session, the index had added over 1,300 points.
According to data compiled by Yahoo Finance, three straight days of elevated volatility of around 6% or more have only happened three other times in history: the 1987 market crash, 2008 financial crisis, and the lows of the pandemic.
In a briefing earlier Tuesday, White House press secretary Karoline Leavitt told reporters, "Americans do not need other countries as much as other countries need us."
She added, "President Trump has a spine of steel and he will not break."
Buyers had been wading back into the market after Trump's fast-moving tariff push spurred a roller-coaster session on Monday , which saw the Dow sink 350 points and the S&P 500 cement a historic three-day loss.
Spirits got an initial boost after Treasury Secretary Scott Bessent hailed the start of bilateral trade talks with Japan. The news alleviated fears that the White House wasn't prepared to cut deals on tariffs, given trade adviser Peter Navarro's comment to the Financial Times that Trump's tariffs were "not a negotiation."
Still, the White House said reciprocal tariffs will go into effect on Wednesday as planned, even while deals are negotiated. On Tuesday, China vowed to "fight to the end" if the US continues to pursue what Beijing authorities described as "blackmail."
Read more: Live updates on Trump tariffs fallout
Some top names on Wall Street — from JPMorgan CEO Jamie Dimon to BlackRock CEO Larry Fink — have started warning about the effects of Trump's tariffs. Even Tesla CEO and Trump adviser Elon Musk has offered gentle critiques over the past few days.
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