05:06 PM EDT, 03/13/2025 (MT Newswires) -- US benchmark equity indexes declined Thursday after President Donald Trump threatened a 200% tariff on European Union alcohol exports, further escalating trade tensions.

The Nasdaq Composite slid 2% to 17,303, while the S&P 500 lost 1.4% to 5,521.5. The Dow Jones Industrial Average fell 1.3% to 40,813.6. Baring utilities, all sectors saw losses, led by communication services.

Trump said the US will impose a 200% tariff on all alcohol products coming from the EU if a European tariff placed on US whiskey is not rescinded.

Mexico doesn't plan to retaliate immediately against US import tariffs on aluminum and steel, The Wall Street Journal reported, citing Mexican President Claudia Sheinbaum. Mexico will instead see what the Trump administration does with its global reciprocal tariffs planned for next month, Sheinbaum reportedly said.

Canada and the EU recently announced retaliatory tariffs against the US.

Growing trade tensions have raised market uncertainty in recent weeks, but are unlikely to result in a recession or throw corporate profits off course, Wells Fargo Investment Institute said in a note e-mailed Thursday. Separately, Macquarie said it expects the US economy to narrowly avoid a contraction despite tariff headwinds.

US Treasury yields dropped Thursday, with the two-year rate falling 3.4 basis points to 3.96% and the 10-year rate losing 4.4 basis points to 4.27%.

In economic news, US producer prices were flat last month, marking a slowdown sequentially as wholesale costs of services declined, the Bureau of Labor Statistics reported. On Wednesday, government data showed that consumer inflation decelerated more than expected in February.

"While a welcome directional adjustment, after several months of accelerating price pressures, one month's reprieve does little to instill confidence of a sustained disinflationary trend, particularly as some of the larger monthly gains in the report suggest some further price pressures to come," Stifel said in a Thursday note.

In company news, Adobe (ADBE) shares slumped 14%, the worst performer on the S&P 500.

Adobe's fiscal first-quarter performance from late Wednesday was likely overshadowed by changes to digital media disclosures that left investors craving for visibility into key metrics, Morgan Stanley said in a note emailed Thursday.

Intel ( INTC ) shares jumped nearly 15% Thursday, the top gainer on the S&P 500. The chipmaker late Wednesday appointed semiconductor industry veteran Lip-Bu Tan as chief executive, effective March 18.

Dollar General's ( DG ) fiscal fourth-quarter earnings fell more than Wall Street's expectations Thursday, but sales topped estimates. The discount retailer's shares rose 6.8%, the second-best performer on the S&P 500.

West Texas Intermediate crude oil slid 1.4% to $66.73 a barrel.

Global oil supply is expected to exceed demand this year, while trade tensions are clouding the outlook, the International Energy Agency said.

"The macroeconomic conditions that underpin our oil demand projections deteriorated over the past month as trade tensions escalated between the (US) and several other countries," the IEA said. "New US tariffs, combined with escalating retaliatory measures, tilted macro risks to the downside."

Gold increased 1.8% to $3,000 per troy ounce, while silver gained 2.2% to $34.49 per ounce.