Feb. 23, 2026 — New York The Dow Jones Industrial Average fell 821.91 points, or 1.66%, to close at 48,804.06 on Monday, its largest single-day drop since January, as investors reacted to President Trump’s latest tariff escalation following a Supreme Court ruling and growing concerns over artificial intelligence disruption in key sectors.
The broader S&P 500 declined 71.76 points, or 1.04%, to 6,837.75, while the Nasdaq Composite dropped 258.80 points, or 1.13%, to 22,627.27. More than 60% of S&P 500 stocks ended lower.
Trump announced plans for a 15% global tariff on imports under new legal authority via Section 122 after the Supreme Court struck down previous tariffs imposed under the International Emergency Economic Powers Act (IEEPA), sparking confusion over potential refunds and trade deals. U.S. Trade Representative Jamieson Greer stated America intends to uphold existing bilateral trade agreements.
“The push and pull with tariffs is likely to be a distracting theme for markets for the remainder of the year, albeit with less volatility than the initial shock last April,” said Michael Landsberg, CIO at Landsberg Bennett Private Wealth Management.
AI fears intensified after a Citrini Research report warned of economic fallout from AI proliferation, potentially eroding profits at software firms and banks. The software sector ETF fell 5.07%, with AppLovin down 9.09%.
Financial stocks bore the brunt, as the KBW Nasdaq Bank Index slid 4.4%. American Express shares sank 7.2%, JPMorgan dropped 4.22%, and Goldman Sachs fell 3.25%. IBM plunged 13.15% following news of AI advancements in COBOL modernization.
Mixed economic data added pressure, with Q4 GDP at 1.4% versus 3% expected and Core PCE at 0.4%, signaling stagflation and slashing March rate cut odds to 5%, according to pre-market analysis.
“The selloff is based on the AI scare trade, a theme that says excess profits will get frittered away by new and in some cases non-existent competitors,” said Mike Mayo, analyst at Wells Fargo.
Trade-sensitive retailers also declined, including American Eagle Outfitters down 6.37%.
Going into tonight's open, be prepared for red across the board. […] $NVDA reports Wednesday. That will be the first real chance for bulls to make a stand.
— Prosperiax (@Prosperiaxnews) February 22, 2026
