U.S. equities reversed course from last week’s record highs after President Donald Trump escalated trade tensions, unveiling 25% tariffs on goods from Japan, South Korea and a clutch of other nations unless new agreements are reached within days. The Dow Jones Industrial Average fell 0.94% to 44,406.36, the S&P 500 lost 0.79% to 6,229.98 and the Nasdaq Composite declined 0.91% to 20,412.52. Nine of 11 S&P 500 sectors retreated, led by consumer discretionary and energy, while utilities eked out small gains. Markets slid further after the White House released letters warning at least 14 governments that duties will take effect on 1 August if deals are not struck before a 9 July deadline. Trump also threatened an additional 10% levy on countries he says align with the BRICS bloc, rekindling fears of broader inflationary pressure and slower growth. Tesla was the biggest single drag on the S&P 500, tumbling 6.8%, after Chief Executive Officer Elon Musk said he is creating a new U.S. political organization dubbed the “America Party,” intensifying his feud with the President and raising questions about federal support for the electric-vehicle maker. The renewed tariff risk has traders reassessing the Federal Reserve’s next move; futures pricing compiled by CME Group shows the probability of a September rate cut slipping to roughly 60% as investors weigh the potential economic fallout of the latest trade salvo.