(Reuters) -Investors are bracing for more U.S. stock market volatility when President Donald Trump delivers an address to Congress on Tuesday evening, on the heels of his implementation of new tariffs that rattled asset prices earlier in the day.

The president's remarks come at a pivotal point for markets, as the post-election wave of exuberance and excitement has given way to anxiety that Trump's policies are weighing on economic growth and contributing to inflation.

"A lot of where we are headed next really does depend on what is in this speech," said Steve Sosnick, market strategist at Interactive Brokers. "Investors will be looking for any signs that Trump remains a friend of the markets."

The benchmark S&P 500 has given up its gains for the year and is now in negative territory for 2025. The tech-heavy Nasdaq Composite at one point on Tuesday was down more than 10% from its mid December peak, before recovering somewhat.

Major U.S. stock indexes fell in a volatile session on Tuesday after Trump's new 25% tariffs on imports from Mexico and Canada took effect, along with a doubling of duties on Chinese goods to 20%.

"Sentiment has shifted incredibly quickly from excitement about a new Trump administration to fear," said Tim Urbanowicz, chief investment strategist for Innovator Capital Management.

"Everyone had been focused on the pro-growth policies, and I don't think investors were taking him seriously when he talked about tariffs, but now that threat has materialized and created a growth scare."

Jim Carroll, senior wealth advisor at Ballast Rock Private Wealth Management, noted the Cboe Volatility Index has been rising steadily in recent trading sessions. On Tuesday it briefly broke above 26, with any level higher than 20 seen as a sign that stock market participants are uneasy.

"Underneath the surface, markets have become less and less enthusiastic than the closing prints on the S&P 500 told us," said Carroll.

Colin Graham, London-based head of multi-asset strategies for Robeco, is already preparing for still more uncertainty.

"We've taken off our bullish trade on the 10-year Treasury, and gone back to being neutral on stocks," Graham said. "We're in the camp of let's take less risk while we see how things play out."