The Dow Jones Industrial Average plunged 1,070 points, or 2.5%, to 41,156, shortly after trade opened Thursday as spooked investors tried to assess the impact of the latest round of Trump administration tariffs.

President Trump on Wednesday announced a 10% baseline tariff on all U.S. trading partners and higher levies on dozens of countries that charge higher taxes on American exports. Mr. Trump has said the goal is to make global commerce more fair, spur companies to expand in the U.S. and generate federal revenue. 

But experts warn that sharply ramping up tariffs on imports, coupled with any retaliatory measures from other nations, could drive up inflation, dampen spending by consumers and businesses and hurt economic growth. 

The tech-heavy Nasdaq also cratered, dropping 752 points, or 4.3%, while the broader S&P 500 sank 3.2%.

“Market uncertainty is likely to remain elevated in the weeks ahead, as investors consider likely downgrades to consensus U.S. economic and earnings growth forecasts, the risk of a tit-for-tat escalation in tariffs and the potential scope for tariffs announced to be negotiated down,” Solita Marcelli, Chief Investment Officer Americas at UBS Global Wealth Management, said in a note to investors.

Overseas markets also slumped. In Asia, Tokyo’s Nikkei 225 index briefly dipped 4%, with automakers and banks taking big hits, before closing down 2.8%, while South Korea’s benchmark Kospi fell 1.1%. In midday trading in Europe, Germany’s DAX fell 2.4%, France’s CAC 40 in Paris lost 2.7% and Britain’s FTSE 100 shed 1.5%.

Appearing on CNN Thursday, White House Press Secretary Karoline Leavitt expressed confidence that the Trump administration’s economic policies would pay off. Commenting on global financial markets sliding overnight, she said, “To anyone on Wall Street this morning, I would say trust in President Trump.”

contributed to this report.