The S&P 500 and the Nasdaq were set for their worst drops in one month on Tuesday as calls for impeachment of US President Donald Trump gained momentum, while weak consumer confidence data added to worries over the prolonged Sino-US trade war.
Losses in US stocks accelerated, with the Dow Industrials set for its sharpest drop in three weeks after US Representative John Lewis on Tuesday became one of the most senior Democrat leaders in calling for impeachment proceedings to begin against Trump.
Calls from some Democrats for Trump's impeachment for trying to enlist a foreign power to smear a domestic opponent increased after a whistleblower from within the US intelligence community lodged a complaint with an internal watchdog about a phone conversation between Trump and Ukrainian President Volodymyr Zelensky.
Trump denied that he had held back US aid to Ukraine as leverage to initiate an investigation that would damage Democratic political rival Joe Biden.
"The situation between the President and what occurred in the Ukraine and of course possibly bringing charges towards (his) impeachment, I think that's what led to the selloff largely being run by the algorithms," said Robert Pavlik, chief investment strategist and senior portfolio manager at SlateStone Wealth LLC in New York.
Wall Street's major indexes lost footing earlier in the day as Trump took a harsh tone in addressing China's trade practices, while disappointing consumer confidence data raised concerns over the economic impact of a prolonged trade war between the two nations.
At 13:46 ET, the Dow Jones Industrial Average was down 187.54 points, or 0.70%, at 26,762.45, the S&P 500 was down 27.03 points, or 0.90%, at 2,964.75. The Nasdaq Composite was down 118.36 points, or 1.46%, at 7,994.11.
The benchmark S&P 500 hit a two-week low. Nine of the 11 major S&P sectors were lower, with the energy sector down 1.8%, tracking a drop in oil prices.