US stocks drop after Trump ramps up his tariffs and investors dump
potential AI losers
[February 24, 2026] By
STAN CHOE
NEW YORK (AP) — U.S. stocks slumped Monday after President Donald Trump
ramped up his newest tariffs, while investors continued to punish
companies that could be losers in the artificial-intelligence
revolution.
The S&P 500 fell 1% after Trump said on Saturday that he would place
temporary 15% tariffs on other countries. That’s up from the 10% rate he
announced Friday following a Supreme Court ruling that struck down his
sweeping “reciprocal” taxes on imports from around the world.
The Dow Jones Industrial Average dropped 821 points, or 1.7%, and the
Nasdaq composite sank 1.1%.
Trump’s quick move toward more aggressive tariffs shows how much
uncertainty still hangs over the global economy, even after the Supreme
Court said the president lacked the legal authority to institute his
sweeping “reciprocal” tariffs.
Beyond a 15% tariff that could last for up to 150 days, unless Congress
extends it further, Trump is moving forward on other avenues to place
more permanent tariffs on countries and industries. That has trading
partners uneasy. South Korea’s trade minister, Kim Jung-kwan, said
Monday that uncertainty may worsen if the Trump administration continues
imposing new tariffs under alternative laws.
To be sure, Monday’s moves for markets weren’t close to as bad as the
panic that swept the world in April, when Trump initially announced his
“Liberation Day” tariffs. U.S. stocks were modestly higher for a brief
moment during the morning.
The U.S. dollar’s value edged lower against other currencies. Bitcoin
briefly fell below $64,000 but remained above its low point reached
earlier this month. Gold continued to rise thanks to its reputation as
something safer to own during uncertain times.
Investors may be sensing it will take a long time, as well as more court
battles, before more clarity comes about how global trade will look.
“Stocks got a boost Friday from the Supreme Court’s tariff ruling, but
it quickly became clear that the decision was simply going to open a new
chapter in the trade saga, not end it,” according to Chris Larkin,
managing director, trading and investing, at E-Trade from Morgan
Stanley.
On Wall Street, big losses hit companies under suspicion of getting
undercut by AI-powered rivals. Investors have been sharply and suddenly
punishing stocks of such companies recently.
CrowdStrike fell 9.8% to widen its loss for the young year so far to
25.3%. A new tool from Anthropic that scans codebases for security
vulnerabilities and suggests targeted software patches for human review
has been hitting stocks across the cybersecurity industry.
AppLovin sank 9.1% and took its loss for the year to date to 43.5%. It’s
among the software companies hurt by worries that AI competition will
steal customers and fundamentally reset their industries.
Companies that have lent money to software companies whose revenues may
be under threat also continued falling, and Blue Owl Capital fell 3.4%
to bring its loss for the year so far to 30.1%.
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Trader Timothy Nick, left, and Robert Charmak work on the floor of
the New York Stock Exchange, Friday, Feb. 20, 2026. (AP
Photo/Richard Drew)
 More big moves may still be ahead
for Wall Street this week, particularly with a profit report from
Nvidia coming on Wednesday.
Worries are rising that companies like Alphabet and
Amazon may be spending so much on Nvidia’s chips that they’ll never
be able to recoup their investments through higher productivity and
future profits.
Elsewhere on Wall Street, stocks of airlines fell after heavy snow
and high winds canceled thousands of flights across the busy
Northeast.
United Airlines lost 5.2%, American Airlines fell 4.9% and Delta Air
Lines sank 3.7%.
Novo Nordisk’s stock that trades in the United States tumbled 16.4%
after the Danish drugmaker said a trial for its CagriSema drug
showed people lost a smaller percentage of their weight after 84
weeks than with a similar one made by rival Eli Lilly. Eli Lilly
rose 4.9%.
All told, the S&P 500 fell 71.76 points to 6,837.75. The Dow Jones
Industrial Average dropped 821.91 to 48,804.06, and the Nasdaq
composite sank 258.80 to 22,627.27.
In stock markets abroad, indexes mostly fell in Europe. They had
risen on Friday after the Supreme Court’s ruling.
In Asia, where markets got their first chance to react to the
court’s ruling, Hong Kong’s Hang Seng jumped 2.5%, while South
Korea’s Kospi rose a more modest 0.6%. Markets in Japan and mainland
China were closed for holidays.
In the bond market, the yield on the 10-year Treasury fell to 4.03%
from 4.08% late Friday.
A top official at the Federal Reserve said Monday that it’s a “coin
flip” on whether the Fed will cut its main interest rate at its next
meeting in March or stand pat again.
The comments from Fed. Gov. Christopher Waller were a notable shift
from January, when he was one of the two Fed governors to dissent
against the central bank’s decision to hold its key rate steady
after three rate cuts at the end of last year.
Lower rates would give the economy a boost, and Trump has been
lobbying angrily for them. But they also could risk worsening
inflation.
___
AP Business Writers Matt Ott and Elaine Kurtenbach contributed.
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