Stocks dropped Thursday amid mounting concern over the economic outlook and dismay over President Trump's tariff plans. The Dow Jones industrial average lost 0.5 percent, the S&P 500 fell 1.6 percent and the Nasdaq dropped 2.8 percent. US long-term bond yields, the dollar and oil prices rose.

Trump's latest pledge to proceed with big tariffs on Canada and Mexico and his decision to raise tariffs further on China added to investor worries over the expected disruptive effect of tariffs, including their impact on inflation. Meanwhile, an unexpected jump in weekly jobless claims and much worse than expected pending home sales added to the view that the economy is slowing. At the same time, Federal Reserve officials repeated that they will not rush to cut rates amid lack of clarity over tariffs, immigration, and the inflation outlook generally.

Adding to the woes, markets chose to be disappointed with technology bellwether Nvidia's quarterly results, which led to a 8.5 percent plunge in Nvidia shares that spilled over to the tech sector and chipmakers in particular. Among sectors, worst performers included communications services, information technology, consumer discretionary and utilities. Holding up best were financials, consumer staples, real estate and energy.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.