Stocks Get Hit on AI, Tariff Jitters as Bonds Rise: Markets Wrap
(Bloomberg) — Stocks fell and bonds rose as renewed anxiety over the impact of artificial intelligence on company profits joined lingering tariff uncertainty in squelching risk appetites. Bitcoin tumbled below $65,000. Gold rallied.
The S&P 500 dropped 1%. A key software ETF extended its February plunge, heading toward its worst month since 2008. Delivery and payment shares sank as Citrini Research published a report laying out the potential risks AI could pose to various segments of the global economy. DoorDash Inc., American Express Co. and Blackstone Inc. slumped more than 6%.
Rising anxiety over the impact of AI disruption on multiple sectors resurfaced, with investors dumping shares of any company seen at the slightest risk of being displaced. Worries have also grown despite solid results from megacaps amid doubts over whether massive investments in the technology will pay off soon.
“The AI disruption story probably hasn’t run its course yet,” said Chris Larkin at E*Trade from Morgan Stanley.
Wall Street also continued to parse the implications of the latest trade developments.
Following the Supreme Court’s decision on Friday to nix President Donald Trump’s “reciprocal” tariffs, the White House swiftly announced plans to replace the prior tariffs with a new, across-the-board 15% levy on US imports.
“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 at Landsberg Bennett Private Wealth Management.
As caution prevailed, a rally in Treasuries sent 10-year yields down six basis points to 4.02%. Haven currencies outperformed while gold topped $5,200.
Key events this week include Trump’s State of the Union address tomorrow, Nvidia Corp.’s results Wednesday and a Friday reading on producer prices that will help shape the policy outlook.
Federal Reserve Governor Christopher Waller said his March rate call will hinge on jobs data. Money markets are fully pricing in the next cut only in September.
The New York Stock Exchange and Nasdaq said they’d be operating their markets as normal just as a powerful winter storm buries the city in one of its 10 snowiest days on record.
“Given the various economic risks and uncertainties that can be linked to the tariff drama, we expect the Fed’s wait-and-see approach to be reinforced,” said Ian Lyngen at BMO Capital Markets.
The bar is higher for the next rate cut in light of the stabilization in the labor market, Lyngen noted, adding that the onus is back on moderating inflation to justify further normalization.
At Edward Jones, Angelo Kourkafas said the newly announced 15% tariff rate is unlikely to have a meaningful impact on economic activity.
“We advise investors not to overreact to headlines, and we reiterate our constructive outlook for global equity markets, supported by strong corporate profit growth and healthy economic activity,” he added.
With the technology sector lagging in 2026 amid concerns about AI disruption, he says a balance between growth- and value-style sectors will be key to investor success this year.
“We recommend overweight positions in industrials, health care, and consumer discretionary, offset by underweights in consumer staples and utilities,” Kourkafas noted.
Corporate Highlights:
Anthropic PBC Chief Executive Officer Dario Amodei will meet with US Defense Secretary Pete Hegseth on Tuesday, according to a senior Pentagon official, as contract talks with the artificial intelligence startup remain deadlocked over the company’s insistence on guardrails for use of its technology. PayPal Holdings Inc., the digital payments pioneer, is attracting takeover interest from potential buyers after a stock slide wiped out almost half of its value, according to people familiar with the matter. Gilead Sciences Inc. agreed to buy US cancer-focused biotech Arcellx Inc. for as much as $7.8 billion as it seeks to boost its drug pipeline. Merck & Co. is splitting its main pharmaceutical unit in two in an effort to better highlight the parts of the business that are growing, as it stares down a patent cliff for its best-selling cancer drug Keytruda. Abbott Laboratories is looking to raise about $20 billion from a bond sale to help fund its acquisition of cancer-screening company Exact Sciences Corp., marking one of the biggest offerings to hit the market this year. Novo Nordisk A/S’s next-generation obesity shot delivered less weight loss than Eli Lilly & Co.’s rival blockbuster in yet another blow to the Danish company’s attempts to regain lost ground in the weight-loss market. Estée Lauder Cos. is open to acquisitions as the owner of the Jo Malone and Le Labo brands enters the second year of a turnaround plan under Chief Executive Officer Stéphane de La Faverie. Domino’s Pizza Inc. reported a larger-than-expected rise in comparable sales, as consumers were drawn to the pizza chain’s budget-friendly pies. Jefferies has turned bearish on Deere & Co. after the shares of the agricultural machinery giant rallied to an all-time high last week, saying the stock is pricing in a rebound in the farm economy that appears “elusive.” Live Nation Entertainment Inc. is asking a federal judge to pause the antitrust case brought by the Justice Department and dozens of state attorneys general a week before trial, so it can appeal his ruling last week declining to throw out the case. Honeywell International Inc. has slashed its price to acquire Johnson Matthey Plc’s Catalyst Technologies in a move to save the deal from falling apart. Chevron Corp. signed agreements on Monday to explore taking over Iraq’s West Qurna 2 project, the country’s second-biggest oil field that’s operated by Russia’s Lukoil PJSC. Some of the main moves in markets:
Stocks
The S&P 500 fell 1% as of 1 p.m. New York time The Nasdaq 100 fell 1.3% The Dow Jones Industrial Average fell 1.5% The MSCI World Index fell 0.8% Bloomberg Magnificent 7 Total Return Index fell 1.4% The Russell 2000 Index fell 2.2% IShares Expanded Tech-Software Sector ETF fell 5% DoorDash fell 6.3% American Express fell 7.3% Blackstone fell 6.5% Currencies
The Bloomberg Dollar Spot Index was little changed The euro rose 0.1% to $1.1800 The British pound rose 0.1% to $1.3498 The Japanese yen rose 0.4% to 154.38 per dollar Cryptocurrencies
Bitcoin fell 4.3% to $64,676.51 Ether fell 4.5% to $1,861.61 Bonds
The yield on 10-year Treasuries declined six basis points to 4.02% Germany’s 10-year yield declined three basis points to 2.71% Britain’s 10-year yield declined four basis points to 4.31% The yield on 2-year Treasuries declined four basis points to 3.44% The yield on 30-year Treasuries declined four basis points to 4.69% Commodities
West Texas Intermediate crude fell 0.4% to $66.22 a barrel Spot gold rose 2% to $5,207.10 an ounce ©2026 Bloomberg L.P.
