America News Agency

The Dow Jones Industrial Average fell 626.15 points, or 1.51 percent, to end at 40,936.93. The S&P 500 slid 2.12 percent, closing at 5,528.93. The Nasdaq Composite dropped 3.26 percent and settled at 17,136.30. All three indexes notched their worst days since the global sell-off on Aug. 5.

Chip stocks weighed on the market, with high-flying Nvidia dropping more than 9 percent. Micron, KLA and Advanced Micro Devices also saw declines in the session.

The VanEck Semiconductor ETF (SMH) slid more than 7 percent overall. The S&P 500′s information technology sector lowered the broad index and had its worst day since September 2022.

The market initially took a leg down Tuesday morning after two manufacturing production readings showed signs of weakness. S&P Global showed a decline from July to August, while the Institute for Supply Management came in under the level anticipated by economists polled by Dow Jones. This data reignited concerns about slowing growth within the U.S. economy, which helped drive a closely watched sell-off early last month.

But the momentum for stocks into September wasn’t always expected. Concern over the U.S. economy falling into a recession and the unwinding of a popular hedge fund trade involving the Japanese yen sent stocks tumbling in early August. At one point, the S&P 500 was down more than 7.0 percent for the month before its recovery.

This action comes ahead of the first major economic release of the month on Friday when the U.S. government releases the August jobs report. Wall Street will also have to contend with seasonal headwinds, as September has been the worst month on average for the S&P 500 over the last ten years.