• House Democrats unveiled a new $3 trillion coronavirus relief bill
  • The U.S. consumer price index dropped 0.8% in April from March
  • Minneapolis Fed Neel Kashkari warned that the U.S. economy will not recover quickly

U.S. stocks finished lower on Tuesday as traders took a breather from recent gains and evaluated various political developments and poor economic data. Equity markets plunged in the final hour of trading.

The Dow Jones Industrial Average dropped 457.21 points to 23,764.78, while the S&P 500 fell 60.2 points to 2,870.12 and the Nasdaq Composite Index plunged 189.79 points to 9,002.55.

Tuesday’s volume on the New York Stock Exchange totaled 4.19 billion shares with 767 issues advancing, 35 setting new highs, and 2,183 declining, with 25 setting new lows.

Active movers were led by Uber Technologies Inc. (UBER) General Electric Co. (GE) and Novavax Inc. (NVAX).

Sen. Lindsey Graham (R-S.C.) introduced legislation that could lead to far-reaching sanctions against China if Beijing refuses to cooperate with a coronavirus investigation.

House Democrats unveiled a new $3 trillion coronavirus relief bill to help mitigate impact of the pandemic.

Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, told the Senate Health Committee that a vaccine must be developed to stop the spread of coronavirus, but added such a vaccine will not emerge soon.

Former Food and Drug Administration Commissioner Scott Gottlieb said he expects coronavirus cases to increase as more states reopen their economies.

The U.S. consumer price index dropped 0.8% in April from March -- the biggest monthly decline since December 2008. Annual consumer inflation slowed down to 0.3%, the smallest increase since 2015.

The core consumer price index, which strips out the volatile food and fuel sectors, fell 0.4% in April from the prior month after a 0.1% drop in March.

Minneapolis Federal Reserve President Neel Kashkari warned that the U.S. economy will not recover quickly from the coronavirus crisis.

“The U.S. government is able to issue large amounts of debt cheaply, and should do so to support the economy,” he added.

Philadelphia Federal Reserve Bank President Patrick Harker said the recovery from the pandemic will be uneven. But he warned if the economy reopens too quickly, that could lead to disaster.

"Not only would this be a health catastrophe, but it would reverse the recovery as well," Harker said.

Wuhan, China, reported its first new coronavirus infections since the city ended its lockdown last month.

“Markets have been torn between optimism on the tentative reopening of some economies and caution on the still grim economic data,” said Mike Pyle, global chief investment strategist at BlackRock Investment Institute. “Markets will watch out for any cracks in the financial system and elsewhere in the economy as virus infections climb.”

The National Federation of Independent Business Small Business Optimism Index fell 5.5 points to 90.9 in April. The drop was not as bad as expected.

The Federal Reserve began its Secondary Market Corporate Credit Facility by purchasing exchange-traded funds which track part of the debt market.

Overnight in Asia, markets closed lower. The Shanghai Composite edged down 0.11%; Hong Kong’s Hang Seng fell 1.45%; while Japan’s Nikkei-225 slipped 0.12%.

In Europe markets closed mixed, as Britain’s FTSE-100 gained 1.04%, while France’s CAC-40 fell 0.44% and Germany’s DAX edged up 0.16%.

Crude oil futures jumped 6.92% at $25.81 per barrel, Brent crude slipped 0.13% at $29.94. Gold futures rose 0.45%.

The euro edged up 0.39% at $1.0851 while the pound sterling slipped 0.45% at $1.2278.

The yield on the 10-year Treasury dropped 6.61% to 0.678% while yield on the 30-year Treasury fell 4.43% to 1.381%.