U.S. stock markets posted a second day of steep losses Tuesday, as the U.S. began charging a 25% tariff on products from Mexico and Canada and also doubled a new tariff on Chinese goods to 20%.

The Dow Jones Industrial Average closed Tuesday down 670 points, or 1.5%, with the S&P 500 falling nearly 72 points, or 1.2%, and the Nasdaq exchange declining 65 points, or 0.4%. On Monday, the Dow Jones closed down 650 points as the S&P and Nasdaq posted among their worst days of 2025.

Canadian Prime Minister Justin Trudeau said Tuesday his country would impose its own 25% tariff on about $20 billion of U.S. goods immediately, and tariffs on another $86 billion within the next 21 days. Mexico’s president, Claudia Sheinbaum, said she planned to announce retaliatory tariffs on U.S.-made products this Sunday, March 9.

The Trump administration has said tariffs are needed to curtail drug trafficking and illegal immigration while also increasing domestic production of vital goods like cars and construction materials. Several corporate leaders and economists have warned of prolonged price increases facing consumers and businesses already dealing with elevated costs.

Clark Geranen, chief market strategist at financial services firm CalBay Investments, said in a research note that economic impacts ultimately will hinge on how long newly imposed tariffs remain in place.

"We tend to believe these are more of a negotiation tactic and not the start of a long and drawn-out reciprocal trade war," Geranen said. "Still, in these situations, investors sell first and ask questions later, as seen during Monday’s selloff." 

Executives of Target and Best Buy warned of immediate price increases for consumers and pressures on profits resulting from an emerging tariff-driven trade war between the United States and its border neighbors, Canada and Mexico, along with China.

During a quarterly earnings call with analysts Tuesday, Target CEO Brian Cornell said “tariff uncertainty” is expected to create “meaningful year-over-year profit pressure” in the first quarter of 2025 relative to the rest of the year. Cornell told CNBC that shoppers will “likely see price increases over the next couple of days,” particularly on fruits and vegetables from Mexico.

Best Buy CEO Corie Barry told analysts that China and Mexico are the top two sources for electronics, appliances and related items sold by the Minneapolis-based retailer.

“While Best Buy only directly imports 2% to 3% of our overall assortment, we expect our vendors across our entire assortment will pass along some level of tariff costs to retailers, making price increases for American consumers highly likely,” Barry said.

Other retailers, such as Walmart and Dollar Tree, have also raised concerns about the effects of new tariffs, along with automakers and several economists. Tuesday’s tariff warnings came as Minneapolis-based Target announced planned investments in new stores and remodels, along with updates to speed up supply chains, as part of ongoing efforts to add more than 300 stores over the next 10 years.

A company statement said Target plans to open about 20 stores in 2025, the majority with large formats, with an undisclosed investment to remodel “many more across the country.” The operator of nearly 2,000 current locations said physical stores offer the space and flexibility to optimize the shopping experience “while powering more efficient fulfillment operations and fueling digital growth as part of the company’s stores-as-hubs model.” 

Big-city office attendance averaged 53.9% of its pre-pandemic level for the week ended Feb. 26, rising from the prior week’s 51.5% in Kastle Systems’ tracking of 10 large U.S. regions. It also remained close to the peak 54.2% average reached in late January.

The latest numbers showed Houston again leading for office traffic at 63.9%, followed by Dallas at 63.1% and Austin, Texas, at 60.5%. They were followed by Chicago at 55.9%, New York at 54.1% and San Jose, in California’s Silicon Valley, at 53.2%.

Based on anonymous keycard data from Kastle’s office property clients, the 10-city average has generally hovered around 50% of pre-pandemic attendance for the past year, even as several large companies in multiple industries have increased their in-office work requirements.

Google co-founder Sergey Brin recently told employees in an internal memo that they should be in the office “at least every weekday.” Silicon Valley office attendance has been rising for the past several weeks as tech firms lean more toward in-person work, also recently including Amazon, Apple and Facebook parent Meta.