U.S. markets closed down Wednesday, showing continued weakness amid uncertainty over trade policy and the health of the U.S. economy.
The S&P 500 closed down 2.2% Wednesday. The Dow slipped 1.7%, and the Nasdaq composite was down 3.1%.
Chip companies led losses, saying trade policies from President Donald Trump's White House could cause them to take hits to earnings.
Nvidia was down 6.9%, saying government restrictions on its chip exports could translate to a $5.5 billion effect on its quarterly results. Competitor AMD dropped 7.3%, saying the same restrictions could cause an $800 million hit.
Fed Chair Jerome Powell said Wednesday President Trump's tariffs were “significantly larger than anticipated," but said that the central bank would wait to see whether it needed to adjust interest rates.
"For the time being, we are well positioned to wait for greater clarity," Powell said.
10-year treasury yields fell to 4.28% following Powell's comments.
RELATED STORY | Consumer prices dip in March; economists cautious about future trends
The threat of tariffs boosted consumer spending higher than expected last month. Economists say buyers may be trying to get out ahead of the potential increased prices driven by tariff policy.
But overall, consumer sentiment is weakening. A recent survey found confidence was down 10% in March, thanks at least in part to a "high level of uncertainty around policy."
Wednesday's performance continues stock slides that steepened after President Trump announced an erratic set of tariff policies early in the month. They include a blanket 145% tariff on Chinese goods, blanket 10% tariffs on nearly all other imports worldwide and a global 25% tax on steel and aluminum imports.
