On Tuesday, the Dow Jones Industrial Average decreased 280.23 points, or 1.01 per cent, to 27,502.81. The S&P 500 fell 20.67 points, or 0.66 per cent, to 3,093.20. The Nasdaq Composite Index was down 47.34 points, or 0.55 per cent, to 8,520.64, Xinhua news agency reported.
Most of the 30 Dow components traded in red territory, with Intel and Dow declining 2.76 per cent and 2.52 per cent, respectively, leading the laggards.
Nine of the 11 primary S&P 500 sectors traded on a downbeat note, with the energy sector losing 1.55 per cent, the biggest loser.
US President Donald Trump announced on Monday that he will "restore" tariffs on steel and aluminum imported from Brazil and Argentina, drawing wide concern domestically and abroad.
Calling the move "unexpected," Argentine Minister of Production and Labor Dante Sica said "we still don't know what this implies. We want to know the details and the scope of the announcement."
The Brazil Steel Institute, which represents the interests of steel exporters, said in a statement that the new tariffs would hurt not only Brazilian companies, but also US steel companies, as they would need the semi-finished products imported from Brazil.
Washington's threat to hit French products with tariffs over a taxation dispute concerning large US tech companies also fueled turmoil in the stock market.
( With inputs from IANS )