Stocks fell sharply on Thursday, erasing a big surge from earlier in the day, after President Donald Trump said the U.S. would impose an additional 10% tariff on Chinese imports to the U.S.

The Dow Jones Industrial Average closed 280.85 points lower at 26,583.42 after rallying as much as 311 points earlier in the day. The S&P 500 ended the session down 0.9% at 2,953.56 after rallying more than 1%. The Nasdaq Composite closed down 0.8% at 8,111.12 after jumping more than 1.6%.

"Trade has always been an issue hanging over the market and whether or not we see an escalation, said Quincy Krosby, chief market strategist at Prudential Financial. "The fact is we'll surely get a reaction from Beijing."

"There were concerns that after the [Federal Reserve] meeting and as earnings season began to wind down, the market would be more susceptible to volatility," Krosby said.

Trump said in a series of tweets the tariff will be imposed on $300 billion worth of Chinese goods. The levy will take effect Sept. 1.

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He said later in the day those levies could go up to 25%. Trump's comments came after a U.S. delegation met with Chinese trade officials earlier this week. Those were the first in-person trade talks between China and the U.S. since both countries reached a truce on the situation.

Shares of Caterpillar and Deere, two bellwethers of global trade, dropped to closed more than 2.6% lower. Boeing ended the day down 2%. FedEx shares also fell 4.2%.

Apple, which has managed to avoid large hits from U.S.-China trade tariffs, fell 2.2%. The tech giant told U.S. Trade Representative Robert Lighthizer on June 17 that tariffs on the remaining $300 billion in Chinese imports would cover "all of Apple's major products."

Retail stocks like Nike dropped 3.4%. Yeti Holdings dropped 7% while PVH slid 6.9%. The SPDR S&P Retail ETF (XRT) plummeted by 3.2%.

Treasury yields fell sharply on the news. The benchmark 10-year yield slid to 1.892%, hitting its lowest level since November 2016. The 2-year rate fell to trade at 1.752%.