U.S. markets fell sharply Wednesday, with chip stocks leading the retreat as U.S.-China trade tensions spooked investors. The tech-heavy Nasdaq closed down 3.1%, the S&P 500 lost 2.2%, and the Dow Jones Industrial average fell 700 points,

Major averages were lower on Wednesday, as worries about a U.S.-China trade war rose on news that Nvidia will need a special license to ship graphic processing units to China.

Separate warnings by the chipmaking giant and the chairman of the Federal Reserve about the impact of White House policies contributed to another sell-off on Wall Street.