(For a Reuters live blog on U.S., UK and European stock

markets, click or type LIVE/ in a news window)

*

Crypto stocks fall on lower bitcoin prices

*

Brokerage HSBC downgrades US stocks

*

Nasdaq, S&P 500 hover near five-month lows

*

Indexes down: Dow 0.89%, S&P 500 1.96%, Nasdaq 3.32%

(Updates to mid-session trading)

By Johann M Cherian and Pranav Kashyap

March 10 (Reuters) - The tech-heavy Nasdaq led a selloff

among Wall Street's main indexes on Monday, falling over 3% to a

near six-month low, on fears that a tit-for-tat tariff war could

spark an economic slowdown.

The Nasdaq has fallen more than 10% from its

December high, and confirmed a correction on Thursday.

The S&P 500 is on track to close below its 200-day moving

average for the first time since November 2023. Analysts view

this as a crucial support level, with a break potentially

signaling a larger selloff ahead.

The CBOE Volatility index, also known as Wall

Street's fear gauge, jumped more than 3 points to 26, highest

since December 18.

At 11:26 a.m. ET the Dow Jones Industrial Average

fell 378.81 points, or 0.89%, to 42,422.91, the S&P 500

lost 113.38 points, or 1.96%, to 5,656.82, and the Nasdaq

Composite lost 604.10 points, or 3.32%, to 17,593.00.

Mega-cap growth stocks such as Nvidia ( NVDA ) fell 4.5%,

while Microsoft ( MSFT ) and Amazon.com ( AMZN ) were down over

3% each.

Tesla was down 8.6%, lowest since November 5, after

UBS cut its forecast for the automaker's first-quarter

deliveries.

The technology sector lost 3.8%, leading sectoral

declines on the S&P 500. The domestically focused small-cap

Russell 2000 index fell 1.5%.

JPMorgan Chase ( JPM ) and Goldman Sachs ( GS ) declined and

weighed on the broader banks index.

On the other hand, defensive stocks such as consumer staples

and utilities added nearly 1% each.

In an interview on Sunday, Trump declined to predict whether

the U.S. could face a recession, at a time when investors are

concerned that his fluctuating trade policies on Mexico, Canada

and China could dampen consumer demand and corporate investment.

China's retaliatory tariffs on select U.S. imports are set

to take effect on Monday, with U.S. tariffs on certain base

metals anticipated later in the week.

"The Trump administration seems a little more accepting that

they're okay with the market falling, and they're potentially

even okay with a recession in order to extract their broader

goals," said Ross Mayfield, investment strategist at Baird.

A Reuters poll showed 91% of economists see higher recession

risks due to Trump's shifting trade policies. HSBC also

downgraded U.S. stocks, citing uncertainty around tariffs.

Data on inflation, job openings and consumer confidence are

due later in the week.

On Friday, investors took some comfort from Fed Chair Jerome

Powell's comments that the economy was on a strong footing, but

he also underscored the need for caution on lowering borrowing

costs.

The Federal Open Market Committee will convene next week and

traders expect policy rates to be left unchanged for the first

half of this year, according to data compiled by LSEG.

Crypto stocks such as MicroStrategy ( MSTR ) slid 11.6%,

while Coinbase fell 10% tracking lower bitcoin

prices.

Declining issues outnumbered advancers for a 1.78-to-1 ratio

on the NYSE and a 2.78-to-1 ratio on the Nasdaq.

The S&P 500 posted 24 new 52-week highs and eight new lows,

while the Nasdaq Composite recorded 25 new highs and 156 new

lows.