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By Lucy Bayly

The Dow Jones saw its worst day of trading Monday as markets reacted to the global outcry following President Donald Trump’s executive order on extreme vetting.

The Dow slid by more than 200 points, dropping under its historic milestone high of 20,000. It was a vast departure from the rapid ascent that saw the 120-year-old index gain 9 percentage points since Trump’s election on November 8.

Traders work on the main trading floor of the New York Stock Exchange (NYSE) as the Dow Jones Industrial Average passes the 20,000 mark. REUTERS/Brendan McDermid

The negative market reaction reflected widespread uncertainty after the unprecedented and swift action taken by the Trump administration to restrict travel to America from seven majority-Muslim nations.

Also on Monday, Wall Street's famous "fear index," the CBOE Volatility Index, jumped by 18 percent, according to FactSet.

"You've got a major policy that was implemented very quickly,” John Conlon, chief investment officer at People's United Wealth Management, told CNBC. “That's causing uncertainty."

Though Wall Street initially championed Trump’s hardline tactics to bring about deregulation, boost infrastructure, and reform the tax code, markets were spooked on Monday by the way the controversial immigration measure was executed — with one insider saying he believed investors were thinking twice about the coherence of Trump’s policies and their benefit for the nation.

“I find it very difficult to believe that after pricing in heavy premiums based on fiscal promises, that investors are not now reconsidering what damage Trump might do by implementing other promises that supplemented an incoherent and ranting political campaign," said Jameel Ahmad, vice president of research at FXTM, told CNBC.

"Whether it is building a wall, banning certain nationalities, starting a trade war or pretty much anything else President Trump may do to upset people, it does risk both creating and deepening a negative perception of the U.S.," Ahmad said.