The Nasdaq 100 fell as much as 4.3% before paring the drop to less than 3% midmorning. It’s down almost 9% in three days of selling after its surge from March lows stretched valuations toward levels last seen in the dot-com era. Tesla Inc. tumbled 13% after being snubbed for inclusion in the S&P 500 and is now down more than 20% in September. All 11 S&P 500 groups retreated. West Texas Intermediate crude fell toward $36 a barrel in New York.

The speculative fever that drove huge bullish bets in options markets and saw shares in bankrupt companies surge has broken in September, wiping out trillions in market value. The hardest hit sectors remain shaprly higher for the year, stoking a debate among strategists over whether the latest pullback is a sign of market health or the start of a larger drawdown that has further to go.

“Some froth has come off the market which is a good thing, but keep in mind that we still remain well over levels that could be considered ‘fair value’ in stocks,” Tom Essaye, a former Merrill Lynch trader who founded “The Sevens Report” newsletter, wrote in a note. “And while the outlook for stocks remains generally constructive long term, there’s a lot more downside in this market if we get any major disappointments.”

For now, traders sought the safety of haven assets, pushing Treasury yields lower and strengthening the dollar. Oil approached $40 a barrel in London and gold declined.

The U.S. and China relationship is also back in focus after President Donald Trump said he plans to end America’s reliance on the country. Trump also threatened to punish any American companies that create jobs overseas, and to forbid those that do business in China from winning federal contracts.

Trump Vows to Sharply Scale Back U.S. Economic Ties With China

“The path of least resistance for the market may well be to test the downside,” said Peter Chatwell, head of multi-asset strategy at Mizuho International Plc. “Ultimately, if there is more selloff, I suspect real money investors will take the opportunity to buy the dip.”

In the U.K., the pound weakened and stocks slumped after Prime Minister Boris Johnson vowed he “won’t back down” over sticking points in Brexit trade talks with the EU.

Elsewhere in markets, the Turkish lira weakened to an all-time low against the dollar for a fourth session amid concern that monetary policy remains too loose to backstop the currency.

Equities rose in Asia, with shares in Australia and South Korea leading the advance.

Here are some key events coming up:

• The ECB will probably hold rates on Thursday but indicate that downside risks have intensified, suggesting further easing is possible before year-end.
• U.S. CPI data is due Friday, with consumer prices expected to rise in August for a third straight month.

These are the main moves in markets:

Stocks

• The S&P 500 Index fell 1.9% as of 11 a.m. New York time.
• The Nasdaq 100 lost 2.8% and the Dow Jones Industrial Average fell 1.6%.
• The Stoxx Europe 600 Index dipped 1.8%.
• The MSCI Asia Pacific Index climbed 0.4%.
• The MSCI Emerging Market Index declined 0.2%.

Currencies

• The Bloomberg Dollar Spot Index climbed 0.3%.
• The euro decreased 0.2% to $1.1792.
• The British pound fell 1% to $1.3027.
• The Japanese yen strengthened 0.3% to 105.94 per dollar.
• The offshore yuan weakened 0.2% to 6.8495 per dollar.

Bonds

• The yield on 10-year Treasuries declined six basis points to 0.66%.
• The yield on two-year Treasuries fell one basis point to 0.13%.
• Germany’s 10-year yield declined three basis points to -0.50%.
• Japan’s 10-year yield decreased less than one basis point to 0.04%.

Commodities

• West Texas Intermediate crude decreased 8.9% to $3621 a barrel.
• Brent crude decreased 6.3% to $39.37 a barrel.
• Gold weakened 1.1% to $1,912.50 an ounce.