NEW YORK (Reuters) – Trade-sensitive industrials dragged Wall Street lower on Tuesday as tensions over tariffs between the United States and its European trading partners went from simmer to boil and the IMF lowered its global growth outlook.

All three major U.S. stock indexes finished the session in the red, with the S&P 500 ending its eight-day rally.

U.S. President Donald Trump said he would impose tariffs on $11 billion of European goods, raising tensions over aircraft subsidies that threaten to morph into a wider trade war.

“The European tariff thing caught people by surprise, just as we were working through the China (trade) issues,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.

Trade disputes, along with Britain’s potentially messy exit from the European Union, led the International Monetary Fund (IMF) to cut its global economic growth forecasts and warn that further cuts could follow.

“With the IMF … you’re getting two data points that indicate that things may soften up over the next several months,” Tuz added. “It gives some people reason enough to take money off the table.”

“(But) we’re right on the cusp of earnings season which could change everything.”

First-quarter earnings season is set to begin in earnest, with Delta Airlines reporting on Wednesday and JPMorgan Chase & Co and Wells Fargo & Co results due on Friday, kicking off what analysts now expect to be the first quarter to show a year-on-year decline in profits since 2016.

January-March earnings for S&P 500 companies are now seen falling by 2.5% from last year, according to Refinitiv data.

The Dow Jones Industrial Average fell 190.44 points, or 0.72%, to 26,150.58, the S&P 500 lost 17.57 points, or 0.61%, to 2,878.2 and the Nasdaq Composite dropped 44.61 points, or 0.56%, to 7,909.28.

Of the 11 major sectors in the S&P 500, all but utilities and communications services ended the session in the red.

Industrials posted the biggest percentage loss, falling 1.4%.

Boeing Co extended its slump after reporting a drop in deliveries related to the grounding of its 737 MAX jets. Its shares fell 1.5%.

The grounded Boeing aircraft led American Airlines Group Inc to trim its first-quarter revenue forecasts. The airliner’s stock slid 1.7%.

U.S. Steel Corp slid by 10.0% following Credit Suisse’s downgrade of the stock to “underperform.”

Wynn Resorts Ltd dipped 3.9% after ending takeover talks with Crown Resorts.

The Philadelphia SE Semiconductor index backed off from Monday’s record high, falling 1.1%.

Among winners, Facebook Inc rose 1.5% after Morgan Stanley upped its price target, citing growing revenues from its Instagram segment.

Levi Strauss & Co jumped 2.7% ahead of its first quarterly report since its IPO.

Walt Disney Co shares advanced 1.7% following Cowen’s upgrade to “outperform.”

Declining issues outnumbered advancing ones on the NYSE by a 2.74-to-1 ratio; on Nasdaq, a 2.70-to-1 ratio favoured decliners.

The S&P 500 posted 17 new 52-week highs and no new lows; the Nasdaq Composite recorded 51 new highs and 28 new lows.

Volume on U.S. exchanges was 6.31 billion shares, compared to the 7.26 billion average over the last 20 trading days.