Market Tensions Ahead of Trump’s Tariff Plans

Wall Street is preparing for President Donald Trump’s upcoming tariff proposals next week, especially following a Supreme Court ruling that took place on Friday. Traders are also attentive to rising tensions with Iran and are eager to see Nvidia’s latest earnings report.

On Friday, stocks fluctuated as the Supreme Court determined that Trump had misused the International Emergency Economic Powers Act (IEEPA) to implement reciprocal tariffs. In light of this, Trump announced plans to impose a new 10% “universal tariff” utilizing different trade law authorities. Initially, major market averages enjoyed a rally post-ruling, but a subsequent sell-off occurred as investors began to fret about trade tensions and the hope that refunds would be issued to affected companies—which could help control inflation.

Tim Holland, the chief investment officer at Orion Wealth Management, commented that both Wall Street and Main Street will contend with tariff and trade issues for the foreseeable future. Another point of concern for the market is a refund situation in which importers who previously paid IEEPA tariffs might need to repay billions, pushing the matter back to lower courts for what could be a long legal struggle. Ed Mills from Raymond James noted that the journey for companies seeking these refunds is likely to be complex, requiring individual litigation or class action lawsuits.

Unless Trump can garner Congressional support, future tariffs may lack breadth. If inflation lessens, the Federal Reserve might find more leeway to reduce interest rates, creating a careful watch for policy cues from the White House. Trump is set to address Congress for his State of the Union on Tuesday, where he might deliver an ultimatum regarding Iran. Last week, he urged Iran to negotiate a deal about its nuclear program, suggesting severe consequences if they do not comply within an unspecified timeline.

Nvidia’s earnings are also a focal point, with results expected on Wednesday. The company, along with another stock, has notably performed well this year; however, it faces high expectations for its upcoming report, particularly concerning its investments in artificial intelligence.

As markets approach the weekend, there’s a palpable sense of tension. Although past geopolitical risks haven’t significantly swayed stock markets, investors might consider pulling back, given that stocks are just a few points short of their all-time highs. Disappointment from Nvidia, a major player within the S&P 500, could further dampen market spirits. Justin Bergner from Gabelli Funds mentioned he’s adopting a defensive strategy, leaning towards consumer staples, healthcare, and utilities due to the potential for a common midterm election year decline of around 10% to 15%.

Looking ahead, there is cautious optimism that last year’s fiscal stimulus—characterized by increased government spending and tax cuts for consumers and corporations—will materialize in the forthcoming months, reversing any emerging economic downturn.

Week Ahead Calendar

Monday, February 23

• 10am – Endurance Orders (December)
• 10am – Factory Orders (December)
• Earnings: Keysight Technologies, Diamondback Energy, Domino’s Pizza, Dominion Energy

Tuesday, February 24

• 9am – FHFA Home Price Index (December)
• 10am – Consumer Confidence Index (February)
• 10am – Wholesale Inventory (December)
• 9pm – 2026 State of the Union (SOTU)
• Earnings: First Solar, Axon Enterprise, Workday, The Mosaic Co., HP, GoDaddy, CoStar Group, Fidelity National Information Services, American Tower, Home Depot, NRG Energy, Keurig Dr Pepper, EOG Resources

Wednesday, February 25

• Earnings: Salesforce, Nvidia, TKO Group Holdings, Synopsys, VICI Properties, Universal Health Services, Paramount Skydance, Agilent Technologies, The Trade Desk, Lowe’s Companies, TJX Company, Pinnacle West Capital, Raymond James Financial, APA Corp.

Thursday, February 26

• 8:30am – First Billing (2/21)
• Earnings: Block, Solventum, Dell Technologies, SBA Communications, NetApp, Autodesk, Intuit, Coterra Energy, Sempra, Public Service Enterprise Group, Vistra, The JM Smucker Co., Viatris, Hormel Foods, Qnity Electronics, The AES Corp.

Friday, February 27

• 8:30 a.m. – Producer Price Index (January)
• 8:30 a.m. – Wholesale Inventories (January)
• 9:45 a.m. – Chicago PMI (February)
• 10:00 a.m. – Construction expenditure (December)