Stocks slide as Trump extends trade war to Mexico

Stocks suffered a broad selloff after President Donald Trump shocked markets with the threat to impose new tariffs on Mexico. Last night, President Trump announced that starting on June 10, the U.S. will impose a 5% tariff on all goods imported from Mexico, which will be raised to 10% on July 1 if Mexico has not taken action to "dramatically reduce or eliminate the number of illegal aliens" crossing into the United States. Tariffs will be increased steadily to 25% by October, Trump has threatened. With the trade fight ongoing with China, and showing no signs of ending soon, this new tariff front has put investors further on edge.

ECONOMIC EVENTS: In the U.S., personal income rose 0.5% with spending up 0.3% in April. The Chicago PMI edged up 1.6 points to 54.2 in May, which was a little better than forecast. The final University of Michigan consumer sentiment survey for May came in at 100.0, which was up from the 97.2 April reading, but down from the preliminary 102.4 figure for this month.

In China, the National Bureau of Statistics' manufacturing PMI for May slumped to 49.4 from April's 50.1 reading. The non-manufacturing PMI was flat compared to April with a reading of 54.3.

TOP NEWS: The Gap (GPS) was the worst performing stock on the S&P 500, falling 9.3% following the Q1 miss and fiscal year guide down reported last night by the apparel retailer.

Many of the other worst performers on the S&P 500 were companies with outsized exposure to Mexico, including auto parts supplier Delphi Technologies (DLPH), Mexican beer importer Constellation Brands (STZ), railroad operator Kansas City Southern (KSU) and toymaker Mattel (MAT).

Uber (UBER) closed fractionally higher following the ridesharing company's first earnings report since coming public.

Amazon (AMZN) is interested in acquiring Boost Mobile from T-Mobile (TMUS) and Sprint (S), mainly for an attached wholesale deal that would let the buyer use T-Mobile's wireless network for at least six years, Reuters reported last night. Following that report, and another yesterday that claimed that Comcast (CMCSA) and Charter Communications (CHTR) were showing interest in potentially acquiring airwaves if the mobile companies were selling, Comcast issued a statement to media outlets to deny any interest in acquiring spectrum that might be divested. Comcast also would not be interested in acquiring Boost Mobile if the companies pursue a divestiture, a source told CNBC.

MAJOR MOVERS: Among the notable gainers following earnings were Genesco (GCO) and Williams-Sonoma (WSM), which rose 11.7% and 13.4%, respectively.

Among the noteworthy losers were Verizon (VZ) and AT&T (T), which slipped 4.4% and 4%, respectively, following the report of Amazon's interest in Boost Mobile. However, JPMorgan analyst Philip Cusick believes Amazon is unlikely to enter the wireless market and called those selloffs in the wireless giants' stocks a buying opportunity.

INDEXES: The Dow fell 354.84, or 1.41%, to 24,815.04, the Nasdaq lost 114.57, or 1.51%, to 7,453.15, and the S&P 500 declined 36.02, or 1.29%, to 2,752.70.