U.S. stocks faltered on Tuesday, dragged down by losses in tech, as investors weighed remarks by Federal Reserve Governor Lael Brainard that indicated policymakers were ready to act more aggressively to rein in inflation. Investors also monitored reports indicating the U.S. and European Union are expected to unveil more sanctions against Russia on Wednesday.

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The S&P 500 tumbled 1.3%, and the Dow Jones Industrial Average shed 280 points after climbing for two straight trading sessions. The Nasdaq Composite plunged 2.3% to log its biggest drop in three weeks and erase gains from a tech rally that helped the index pop on Monday. Meanwhile, the 10-year U.S. Treasury yield jumped to 2.56%, its highest level since May 2019.

Brainard, who is awaiting a confirmation vote to serve in the central bank’s number two role, said at a conference on Tuesday that the Fed can raise interest rates more aggressively to dampen the high rate of inflation felt by Americans, also noting that officials will likely start shrinking asset holdings in a about a month (a move that could have the effect of further raising long-term interest rates).

“Currently, inflation is much too high and is subject to upside risks,” Brainard said. “The Committee is prepared to take stronger action if indicators of inflation and inflation expectations indicate that such action is warranted.”

Investors continued to monitor the war in Eastern Europe and weighed reports that the EU is expected to impose another round of sanctions against Russia. In a speech to the United Nations Security Council on Tuesday, Ukrainian President Volodymyr Zelenskyy accused Russian troops of committing "the most terrible war crimes" since World War II.

The United States and Western allies are expected to announce more Russia-related sanctions on Wednesday, Reuters reported, citing a source familiar with the matter.

"Tomorrow, the U.S. will announce, in coordination with the G7 and EU, an additional sweeping package of sanctions measures that will impose significant costs on Russia and send it further down the road of economic, financial, and technological isolation," the source told Reuters.

On the economic front, Deutsche Bank became the first major bank to forecast a recession next year if the Federal Reserve hits the breaks too hard on the economy.

"We no longer see the Fed achieving a soft landing," Deutsche Bank economists wrote in a note. "Instead, we anticipate that a more aggressive tightening of monetary policy will push the economy into a recession."

The warning came as investors closely watch a portion of the Treasury yield curve that inverted last week, a phenomenon that has a history of predicting a recession. Each of the last eight slowdowns dating back to 1969 were preceded by a yield curve inversion.

Nomura Chief U.S. economist Robert Dent told Yahoo Finance Live on Monday that he sees the potential for a "mild recession" ahead.

"We think that the cumulative risk of a recession between now and the end of 2024 stands at about 35% to 40%,” he said. “A lot of that is just coming from what we think is going to be this very aggressive response from the Fed to actually get inflation under control and make sure the labor market actually cools down."

Twitter (TWTR) again inched higher on Tuesday despite broad-based losses in tech after the company said it would name Tesla (TSLA) CEO Elon Musk to its board, one day after the electric vehicle executive revealed he purchased a 9.2% stake in the social media company.

Musk is "speaking with his money by saying that Twitter is an undervalued platform," MKM Partners' Rohit Kulkarni told Yahoo Finance Live on Monday. "He sees there are things they can do to improve the service, and he's definitely hinting at a more active role."

Wedbush Securities analyst and Tesla bull Dan Ives also told Yahoo Finance he predicts Musk will have an active stake in the social media platform over the coming weeks or months, and that his recent snap up of shares was “just the appetizer.”

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4:00 p.m. ET Monday: All three benchmarks close lower following hawkish Brainard comments

Here's how stocks closed out the trading session on Tuesday:

• S&P 500 (^GSPC): -57.31 (-1.25%) to 4,525.33

• Dow (^DJI): -279.52 (-0.80%) to 34,642.36

• Nasdaq (^IXIC): -328.39 (-2.26%) to 14,204.17

• Crude (CL=F): -$3.13 (-3.03%) to $100.15 a barrel

• Gold (GC=F): -$8.30 (-0.43%) to $1,925.70 per ounce

• 10-year Treasury (^TNX): +14.4 bps to yield 2.5560%

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12:27 p.m. ET: Chipmakers post biggest drop in nearly one month as tech stocks fall

Shares of semiconductor companies declined in intraday trading, weighed down by a broad-based decline in technology stocks.

The Philadelphia Stock Exchange Semiconductor Index fell as much as 4.1% to register its biggest intraday percentage decline in nearly a month.

Notable laggards in the sector included Nvidia (NVDA), down 4.2% to $262.07 per share; Lam Research (LCRX), down 5.5% to $505.92 per share; and Marvell Technology (MRVL) down 6.3% to $68.30 as of 12:27 p.m. ET.

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12:19 p.m. ET: Stocks turn lower following two days of gains

Here were the main moves in markets as of 12:18 p.m. ET:

• S&P 500 (^GSPC): -32.28 (-0.70%) to 4,550.36

• Dow (^DJI): -86.23 (-0.25%) to 34,835.65

• Nasdaq (^IXIC): -261.54 (-1.80%) to 14,271.01

• Crude (CL=F): -$0.43 (-0.42%) to $102.85 a barrel

• Gold (GC=F): -$10.30 (-0.53%) to $1,923.70 per ounce

• 10-year Treasury (^TNX): +14.6 bps to yield 2.5580%

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10:43 a.m. ET: US service sector activity picks up in March but higher costs persist

Activity in the U.S. services industry regained speed last month thanks to a boost from further rollbacks of COVID restrictions, but businesses continued to face higher costs as supply chain constraints weighed on prices.

The Institute for Supply Management (ISM) reported its non-manufacturing activity index rebounded to a reading of 58.3 last month from a one-year low of 56.5 in February.

That increase capped three straight months of declines in the index and underscored a shift in spending back to services from goods.

Economists surveyed by Bloomberg had forecast the non-manufacturing index rising to 58.5. Readings above 50 indicate expansion in the services sector, which accounts for more than two-thirds of U.S. economic activity.

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10:33 a.m. ET: Fed gov Brainard says central bank is ready for "stronger actions" on inflation

Federal Reserve Governor Lael Brainard said the central bank can raise interest rates more aggressively to dampen the high rate of inflation felt by Americans.

Brainard added that policymakers are attuned to the disparate impacts of rising prices, particularly on lower-income households.

“Currently, inflation is much too high and is subject to upside risks,” Brainard said at a conference Tuesday. “The Committee is prepared to take stronger action if indicators of inflation and inflation expectations indicate that such action is warranted.”

Inflation data released last week showed prices in the United States rising by 6.4% on a year-over-year basis in February, the fastest pace since 1982.

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10:23 a.m. ET: Twitter to name Elon Musk to board after Tesla CEO reveals 9.2% stake

Twitter Inc. (TWTR) announced the company will appoint Tesla Chief Executive Officer Elon Musk to its board, one day after he disclosed a significant stake in the social media company.

The move may temporarily block Musk from proposing a takeover bid, which analysts and investors have speculated may occur after the Tesla CEO revealed his purchase of about $3 billion in shares of Twitter.

According to a filing, Musk cannot own more than 14.9% of Twitter's common stock either as an individual shareholder or as a member of a group as long as he is the director of Twitter.

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9:30 a.m. ET: Stocks dip as investors tune in for more possible sanctions against Russia

Here were the main moves in markets during Tuesday's open:

• S&P 500 (^GSPC): -12.78 (-0.28%) to 4,569.86

• Dow (^DJI): -90.43 (-0.26%) to 34,831.45

• Nasdaq (^IXIC): +271.05 (+1.90%) to 14,532.55

• Crude (CL=F): +$0.83 (+0.80%) to $104.11 a barrel

• Gold (GC=F): +$5.50 (+0.28%) to $1,939.50 per ounce

• 10-year Treasury (^TNX): +4.6 bps to yield 2.4580%

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7:50 a.m. ET: US stops Russian bond payments in move aimed to ramp up pressure on Moscow

The United States stopped the Russian government on Monday from paying holders of its sovereign debt more than $600 million from reserves held at U.S. banks in a bid to place pressure on Moscow.

Foreign currency reserves held by the Russian central bank at U.S. financial institutions were frozen on Feb. 24 as part of sanctions placed on Moscow for over its invasion of Ukraine.

The U.S. Treasury Department, however, had been permitting the Russian government to use funds to make coupon payments on dollar-denominated sovereign debt on a case-by-case basis.

On Monday, the U.S. government moved to cut off Moscow's access to the frozen funds as a $552.4 million principal payment on a maturing bond came due.

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7:10 a.m. ET: Stock futures slip, oil rises following Monday's tech rally

Here were the main moves in futures trading ahead of Tuesday's open:

• S&P 500 futures (ES=F): -10.50 points (-0.23%) to 4,567.25

• Dow futures (YM=F): -83.00 points (-0.24%) to 34,746.00

• Nasdaq futures (NQ=F): -37.75 points (-0.25%) to 15,126.50

• Crude (CL=F): +$1.28 (+1.24%) to $104.56 a barrel

• Gold (GC=F): -$1.70 (-0.09%) to $1,932.30 per ounce

• 10-year Treasury (^TNX): 0.00 bps to yield 2.4120%

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6:12 p.m. ET Monday: Futures open little changed after stocks close higher

Here's where markets were trading ahead of the overnight session on Monday:

• S&P 500 futures (ES=F): -2.25 points (-0.05%) to 4,575.75

• Dow futures (YM=F): -14.00 points (-0.04%) to 34,815.00

• Nasdaq futures (NQ=F): -9.25 points (-0.06%) to 15,155.00

• Crude (CL=F): +$0.43 (+0.42%) to $103.71 a barrel

• Gold (GC=F): +$3.30 (+0.01%) to $1,937.30 per ounce

• 10-year Treasury (^TNX): +3.5 bps to yield 2.4120%

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Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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