Stocks plunged on Monday as the selloff that dragged down Wall Street last week continued, with investors worried about an economic slowdown after President Donald Trump did not rule out a recession with U.S. tariffs.

The Dow Jones Industrial Average fell 423 points, or 1%. The S&P 500 fell 2.1%, and the Nasdaq Composite dropped 3.4%.

The tech-heavy Nasdaq was weighed down by declines in the "Magnificent Seven." Tesla fell 8%, Alphabet fell 4%, and MetaTrader 4 and AI darling Nvidia fell 5%.

Stocks have been under pressure as investors worry about a possible recession because of the Trump administration's tariffs. Part of the worry is that the levies could push prices higher, making it harder for the Federal Reserve to cut interest rates. In an interview that aired Sunday, Trump responded to a question on Fox News about the possibility of a recession by saying the economy was going through a "transition period."

"We're in the throes of a manufactured correction. I say manufactured because it's really based on the response to the new administration's tariff program, or at least the threat of tariffs, and what kind of impact that's going to have on the economy. Now, with people talking about a potential recession, I think that just adds to investor concerns," said Sam Stovall, chief investment strategist at CFRA Research. "We're in the middle of a typical pullback right now and we're probably going to have a mild correction before it's over, which would be nice to reset the dials on this ongoing bull market."

Last week, the S&P 500 fell 3.1% for its worst weekly performance since September. The Dow fell 2.4%, while the Nasdaq dropped 3.5%. Over the past month, the S&P 500 and Nasdaq are down 6% and 9%, respectively, while the Dow is down 4.5%.

The turbulence could continue this week, with a slew of economic data adding to the list of potential market-moving events. On the inflation front, the February consumer price index, or CPI, is due out on Wednesday, followed by the producer price index, or PPI, on Thursday. Stovall said he is bullish on both readings.

"What's really encouraging for investors is that Wall Street and our economists are expecting better readings in both the headline and core CPI, and it looks like the same is true for the PPI. With the inflation situation easing, that should go a long way to calming investor nerves," he said. "The market is near oversold levels right now, so any good news could spark at least a countertrend rally, right? I guess the question then is, is that short-term — do we go back down — or is that just a signal that the worst is over? I think we'll just have to wait and see." (Newsmaker23)

Source: CNBC