Traders work at the New York Stock Exchange on Feb. 26, 2025.
NYSE
The S&P 500 fell during a volatile session, after President Donald Trump’s declaration that tariffs on Canada and Mexico would proceed as planned, as well as a negative reversal in bellwether stock Nvidia following earnings.
The S&P 500 dropped 1.1%. The broad market index remains in the red for the week and month. The Nasdaq Composite pulled back 2%, with Nvidia’s 6.3% slide pulling the tech-heavy index lower. The Dow Jones Industrial Average inched down 0.3%.
In a post on Truth Social, Trump announced the proposed tariffs of 25% on Mexico and Canada will take effect on March 4 after the one-month moratorium ends. Trump claimed hat the two countries had yet to curb the flow of drugs over the border by enough. The president also stated that China, which already faces 10% tariffs from the U.S., would face an additional 10% levy.
“We’re in a stalled, range-bound, slightly irrational market as we wait for policy clarity,” said Jay Hatfield, CEO of Infrastructure Capital Advisors.
Shares of Nvidia fell even after the chip giant exceeded fourth-quarter estimates on the top and bottom lines. The AI play also issued strong guidance, reflecting continued demand driven by the artificial intelligence race. However, the company posted a decline in gross margins for the quarter and its smallest revenue beat in two years, raising questions about whether the bull market leader could keep its momentum going.
“Nvidia earnings were outstanding, but they come during an extremely jittery stock market,” said James Demmert, chief investment officer at Main Street Research.
Besides Trump’s tariff declaration, a jump in jobless claims also subdued sentiment, adding to recent concerns of economic softening. Jobless claims for the week ending Feb. 22 came in at 242,000. This was up 22,000 from the previous week’s revised level and higher than the Dow Jones estimate for 225,000, according to a Labor Department report Thursday.
This comes on the back of several other recent economic reports — including a softer-than-expected consumer confidence reading, disappointing retail sales numbers and a weak consumer sentiment reading — which have rattled stocks and raised worries about the health of the U.S. economy.
Traders are now looking ahead to Friday’s personal consumption expenditures price index — the Federal Reserve’s preferred inflation gauge.
With just two trading sessions left in February, all three major averages are on pace to finish lower. The broad market index has dropped 2.3%, while the Dow and the Nasdaq have are down 2.7% and 4.6%, respectively.
