U.S. stocks opened the final week of February on shaky footing, with major indexes falling after President Trump announced a new 15% across-the-board tariff on imports. The move follows last week’s Supreme Court ruling that struck down his prior emergency levies, adding more uncertainty to the global trade outlook just as markets were beginning to stabilize.
The Dow Jones Industrial Average fell more than 1.5%, shedding over 700 points, while the S&P 500 dropped roughly 1%. The Nasdaq Composite also declined more than 1%, pressured by renewed trade tensions and broad risk-off sentiment. The pullback marks a reversal from Friday’s rally, as investors digest what the administration’s latest trade salvo means for corporate margins, inflation, and Federal Reserve policy.
Market Movers:
- Arcellx (ACLX) +78%: Shares skyrocketed after Gilead Sciences agreed to acquire the biotech for $115 per share in cash plus a $5 contingent value right tied to sales of its CAR-T therapy, valuing the deal at roughly $7.8 billion. The transaction is expected to close in the second quarter, with Gilead aiming for earnings accretion beginning in 2028 if FDA approval is secured.
- Vanda Pharmaceuticals (VNDA) +49%: The stock surged following FDA approval of Bysanti to treat bipolar I disorder and schizophrenia. Investors welcomed the green light as a meaningful expansion of Vanda’s commercial portfolio and a potential new revenue driver.
- Veris Residential (VRE) +12%: Shares climbed after the multifamily REIT agreed to be acquired in an all-cash $19 per share deal led by Affinius Capital, implying a $3.4 billion enterprise value. The offer represents a sizable premium to recent trading levels and is expected to close in the second quarter.
- Eli Lilly (LLY) +4%: Shares rose after the FDA approved a label expansion for its obesity drug Zepbound, including a new multi-dose pen option. The move enhances accessibility and pricing flexibility as competition intensifies in the weight-loss market.
- Novo Nordisk (NVO) -15%: Shares plunged after its experimental obesity treatment CagriSema failed to meet a key endpoint in a head-to-head study against Lilly’s tirzepatide. The setback deepens competitive pressure in a high-stakes segment that has driven much of Novo’s recent growth narrative.
- VF Corp. (VFC) -8%: The stock fell after a downgrade from JPMorgan, which cited weaker earnings visibility and trimmed profit forecasts through fiscal 2028. The firm’s revised outlook implies potential downside from current levels.
- DoorDash (DASH) -7%: Shares declined amid broader weakness in software and payments stocks after a research note raised concerns that AI-driven disruption could ultimately pressure transaction-based business models. The sell-off extended across fintech and platform names as investors reassessed long-term margin durability.
Trade Tensions Reignite Market Volatility
The administration’s new tariff announcement has added new uncertainty to global trade negotiations. While last week’s Supreme Court decision briefly buoyed hopes of de-escalation, the 15% blanket tariff signals that trade policy remains fluid and politically charged. The European Union has already pushed back against the move, and investors are weighing the possibility of retaliatory measures. Meanwhile, U.S. Customs has halted collection of overturned tariffs, creating operational and legal complexities for businesses navigating shifting rules.
Oil Climbs as Geopolitics and Tariffs Collide
Energy markets added another layer of pressure. Oil prices have climbed more than 15% year-to-date amid geopolitical tensions and supply concerns, with analysts revising price forecasts higher for 2026. The combination of tariff-driven uncertainty and rising crude prices has reignited inflation fears, complicating the Federal Reserve’s path forward. Higher energy costs also risk squeezing consumer spending and corporate margins, particularly in transportation and manufacturing sectors sensitive to input costs.
Hedge Funds Sell, AI Anxiety Returns
Data from prime brokerage desks show hedge funds have been net sellers of global equities at the fastest pace since last spring’s tariff-induced meltdown. Software and fintech stocks have faced renewed pressure as investors debate whether AI could compress margins in transaction-heavy business models. At the same time, Nvidia’s earnings later this week loom large, with markets looking for reassurance that AI demand remains intact despite turbulence across growth sectors.
Looking Ahead
Investors now face a mix of policy uncertainty, inflation risk, and sector rotation. Markets will closely monitor any clarification from the White House on trade strategy, as well as geopolitical developments and commodity price trends. Economic data — particularly upcoming labor and inflation readings — will shape expectations for Fed policy in March. With volatility rising and trade headlines dominating sentiment, the path forward may hinge on whether earnings resilience can offset mounting macro pressures.