The Smoot-Hawley tariff jolted an already weakening market. No question there was a lot of margin lending going on, but the key exogenous shock was the passage through Congressional committees of S-H, which threatened to jack up prices on domestic goods anywhere from 5% to 30%. With items like cars, for example, this meant a tremendous hit to sales. (Subsequent economists have argued that S-H was never properly "valued" because economists did not take into account the deflation by the Fed, and that S-H's real impact was about 5% of GNP---a phenomenal amount, and an amount large enough by itself to cause the Depression.)
The Fed screwed things up, too, by constricting the money supply, and the nation saw its gold flowing out because we---but only the U.S.---were still on the gold standard. It was a perfect storm of bad policies.