Stocks are falling again on Wall Street as companies and investors react to President Donald Trump’s decision to impose tariffs on the U.S.’s biggest trading partners.

The S&P 500 dropped 1.90% Tuesday morning, the Nasdaq fell 2.01% and the Dow slid 735 points, or 1.70% as of 10:18 a.m. EST.

The burgeoning trade war between the U.S., China, Canada and Mexico is helping to extend a recent slump for U.S. stocks that was prompted by signs of weakness in the economy.

Shares of Target and Best Buy fell after the retailers warned of higher prices for consumers due to tariffs. Markets in Europe fell sharply while stocks in Asia saw more modest declines.

China's tariffs on American beef, corn, soy and other farm products announced Tuesday expanded the potential impact of Trump’s trade tactics, said Francis Lun, CEO of Geo Securities in Hong Kong.

“I don’t think China will buy any more U.S. farm products. The orders will go to South America,” Lun said. “I think all in all, it’s a lose-lose situation. Nobody gains anything.”

Anxiety over tariffs is also bleeding into the corporate side of the economic equation. Target reported Tuesday that sales and profit in the crucial holiday quarter both fell from a year ago, though they were better than expected. The Minnesota retailer said there will be “meaningful pressure” on its profits to start the year because of tariffs and other costs.

Target shares were largely unchanged before markets opened Tuesday.

Walgreen's jumped 4.8% in the early going after The Wall Street Journal reported that the struggling pharmacy chain is in the midst of a deal to go private. Citing unnamed sources, the Journal reported that private-equity firm Sycamore Partners would take the struggling drugstore chain off the public market for around $10 billion and that a deal could be reached as soon as Thursday.

Many had hoped Trump would choose a less painful path on global trade. Monday’s loss shaved the S&P 500’s gain since Election Day down to just over 1% from a peak of more than 6%. That rally had been built largely on hopes for policies from Trump that would strengthen the U.S. economy and businesses.

After the S&P 500 set a record last month following a parade of fatter-than-expected profit reports from big U.S. companies, the market began diving following weaker-than-expected reports on the U.S. economy, including a couple showing U.S. households are getting much more pessimistic about inflation because of the threat of tariffs.

In Europe at midday, Germany's DAX slipped 2.3%, while in Paris the CAC 40 declined 1.4%. Britain's FTSE 100 lost 0.5%.

In Asian trading, Tokyo's Nikkei 225 dropped 1.2% to 37,331.18, while the Hang Seng in Hong Kong lost 0.4% to 22,922.16. The Shanghai Composite index edged 0.2% higher to 3,324.21.

South Korea's Kospi gave up 0.2% to 2,528.92. Taiwan's Taiex shed 0.7%, while Bangkok's SET lost 1.1%.