US benchmark equity indexes closed lower on Tuesday as the recent tariff announcements continue to weigh on markets and investor sentiment.

The Nasdaq Composite decreased 2.2% to 15,267.91, while the S&P 500 fell 1.6% to 4,982.77. The Dow Jones Industrial Average was down 0.8% to 37,645.59. All sectors declined, with materials and consumer discretionary as the worst performers.

US Treasury yields were mixed, with the 10-year rate gaining about 7.6 basis points to 4.3% and the two-year rate down 6.2 basis points to 3.7%.

May West Texas Intermediate crude oil decreased 3.8% to $58.41 a barrel on Tuesday.

The Trump administration is moving forward with an additional 50% tariff on China that brings the total rate of levies on the country to 104%, a White House official told CNBC. The new rate goes into effect at 12:01 a.m. ET Wednesday.

President Donald Trump said Tuesday he had "a great call" with the acting president of South Korea, Han Duck-soo, who wants to strike a deal with the US, along with many other countries.

"China also wants to make a deal, badly, but they don't know how to get it started," Trump said in a social media post. "We are waiting for their call. It will happen!"

In economic news, small business optimism in the US deteriorated more than expected in March as owners scaled back expectations on sales growth, a survey by the National Federation of Independent Business showed.

The NFIB small business optimism fell 3.3 points to 97.4 last month, below the consensus of 99 in a survey compiled by Bloomberg.

"The implementation of new policy priorities has heightened the level of uncertainty among small business owners over the past few months," said NFIB Chief Economist Bill Dunkelberg. "Small business owners have scaled back expectations on sales growth as they better understand how these rearrangements might impact them."

In company news, Humana (HUM) was the top performer on the S&P 500, with shares up nearly 11%. The US Centers for Medicare and Medicaid Services said late Monday it will increase payment rates for Medicare insurers next year. CVS Health (CVS) and UnitedHealth Group (UNH) gained 6% and 5.6%, respectively.

RTX (RTX) was up 2.7%. The company's Pratt & Whitney business said Tuesday that it has developed a new additive manufacturing repair that will reduce process time by over 60% for critical GTF engine components.

Best Buy (BBY) shares were down 8.3%. Evercore lowered the price target on the company's stock to $70 from $80 and maintained its in line rating.

Micron Technology (MU) shares fell 4.1%. The company will levy a surcharge on several of its products starting April 9 in response to new US tariffs, news outlets reported.

Gold increased 0.7% to $2,993.80 per troy ounce, while silver was up 0.2% to $29.67 per troy ounce.