During the week of February 17-20, 2026, US equity markets experienced significant volatility before closing mostly higher, driven primarily by a Supreme Court ruling on Friday, that struck down Trump's tariff program. The court decision provided an immediate boost to markets, with the S&P 500 finishing the week up 1.1%, the Nasdaq gaining 1.5%, and the Dow Jones advancing 0.25%. Treasury yields remained stable, while credit spreads tightened slightly, reflecting improved market sentiment.
Technology sector volatility persisted as investors continued questioning the sustainability of AI-related valuations amid concerns about potential business model disruptions. Adding to market uncertainty, newly released economic data came in softer than expected. Fourth-quarter GDP growth fell short of estimates, while both consumer sentiment and manufacturing data also showed weakness.
The initial market optimism from Friday's Supreme Court ruling was quickly undermined over the weekend when Trump responded by imposing new tariffs that escalated to 15%, a temporary 150 days measure that does not need immediate congressional approval. Markets reacted negatively to this policy reversal, with major indexes opening lower on Monday.
