By Caroline Valetkevitch

NEW YORK (Reuters) – U.S. stocks fell in volatile trade on Tuesday, giving the S&P 500 its biggest daily drop in a month, as a push for the impeachment of U.S. President Donald Trump gained momentum among Democrats in the U.S. Congress.

Further pressuring Wall Street, disappointing consumer confidence data underscored concerns over the economic impact of a prolonged U.S.-China trade war.

Democratic House Speaker Nancy Pelosi will announce a formal impeachment inquiry of Trump, a Republican, later on Tuesday, according to several media reports.

Support among Democrats for the start of impeachment proceedings increased after news that Trump may have sought foreign help in smearing a political rival.

Stocks briefly pared losses after Trump, in a tweet, said his administration would release a complete transcript of a call with Ukrainian President Volodymyr Zelenskiy that is at the center of the controversy.

He said the released transcript would show the call was “totally appropriate” and that he had not pressured Zelenskiy to investigate Democratic presidential hopeful Joe Biden and that there had been no quid pro quo for U.S. aid in exchange for a probe.

“What all of that combined is going to do is ensure there is going to be elevated (market) volatility in both directions in the next few days,” said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles.

The Cboe volatility index <.VIX> jumped. The S&P 500 retail index <.SPXRT> fell 1.4%, while Amazon.com <AMZN.O> declined 2.4% and was the biggest drag on the S&P 500 and Nasdaq.

The Dow Jones Industrial Average <.DJI> fell 142.22 points, or 0.53%, to 26,807.77, the S&P 500 <.SPX> lost 25.18 points, or 0.84%, to 2,966.6 and the Nasdaq Composite <.IXIC> dropped 118.84 points, or 1.46%, to 7,993.63.

Wall Street’s major indexes lost their footing early, when Trump took a harsh tone about China’s trade practices.

Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago, said the trade war was likely a bigger issue than possible impeachment proceedings for the market right now.

“I don’t know how strong the case is for impeachment, so I don’t know what will happen with that. We react first and think later,” he said.

Nike Inc <NKE.N> slipped 0.6%, ahead of the world’s largest sportswear maker’s first-quarter results after the bell.

Declining issues outnumbered advancing ones on the NYSE by a 2.20-to-1 ratio; on Nasdaq, a 3.43-to-1 ratio favored decliners.

The S&P 500 posted 31 new 52-week highs and 2 new lows; the Nasdaq Composite recorded 36 new highs and 96 new lows.

Volume on U.S. exchanges was 7.68 billion shares, compared to the 7.2 billion average for the full session over the last 20 trading days.

(Additional reporting by Ambar Warrick, Arjun Panchadar and Medha Singh in Bengaluru; Editing by Sriraj Kalluvila, Shounak Dasgupta and David Gregorio)