Trade Wars Are Flaring Again. What It Means for Investors

By Jeremy Bowman – Updated Feb 23, 2026 at 3:45PM ESTKey PointsPresident Trump announced a 15% global tariff on Saturday after his earlier tariffs were struck down by the Supreme Court.Europe balked at the move, saying, "A deal is a deal." Market moves on a past tariff news have proven to be fleeting.These 10 Stocks Could Mint the Next Wave of Millionaires ›SNPINDEX: ^GSPCS&P 500 IndexToday's Changeangle-down(-1.04%) $71.76Current Price$6837.75Price as of February 23, 2026 at 4:36 PM ETU.S. trade policy was thrown into chaos following the Supreme Court's decision last Friday.Stocks were diving today as Friday's celebration of the Supreme Court's blocking of tariffs was short-lived. By Monday afternoon, all three major indexes were down more than 1% as several news items sent stock market sectors like financials, cybersecurity, and software sharply lower. However, the biggest reason seemed to be renewed trade tensions between the U.S. and Europe over another round of tariff threats. By Monday afternoon, all three major indexes were down more than 1%, and as of 2:47 p.m. ET, the S&P 500 (^GSPC 1.04%) was down 1.2% and the Dow Jones Industrial Average (^DJI 1.66%) was off 1.7%. Image source: Getty Images. What's happening with tariffs After the Supreme Court struck down President Trump's tariffs, he announced a 10% global tariff on Friday afternoon under a different legal authority, and on Saturday, he said he would raise the global tariff rate to 15%.

The Supreme Court ruling also means it's unclear if the government will be able to keep the tariff revenue it's already collected, and it will have to find an alternative way to pay for its budget, which included an expensive tax cut last year. On Monday, the European Union responded that it was pausing its plans to implement the trade deal it agreed to last year, which included a 15% tariff rate. Bernd Lange, the chair of the European Parliament's Committee on International Trade, called the situation "pure tariff chaos" and suggested that new tariffs were a breach of the deal. In a statement, the European Commission said, "A deal is a deal." The uncertainty around the tariff situation now appears higher than ever, as Trump's legal authority looks more dubious than before. What it means for investors Wall Street famously hates uncertainty, and so do multinational corporations. Many S&P 500 stocks had spent the last year rearranging supply chains to mitigate the impact of the tariffs, and it's unclear where they'll go from here. On top of the impact from the tariff uncertainty, sectors like financials and software are reeling after a blog post from Citrini Research described a hypothetical scenario in 2028 where stocks like American Express and ServiceNow were hit hard. Should you ignore the noise? For investors, ignoring the noise around tariffs might be the best course of action for now as past fluctuations, like the original "Liberation Day" announcement, have proven to be fleeting. Some investors have taken to saying, "Trump Always Chickens Out," or TACO, about these tariff threats. Another option is to diversify internationally into markets like Europe, China, or South Korea, which are cheaper than the U.S., and, in fact, international stocks have beaten the S&P 500 over the last year. Overall, there's no immediate reason to change your investing approach based on tariff tensions, but it's an issue investors should pay attention to as it's unlikely to go away anytime soon. Read NextFeb 23, 2026 •By Trevor JennewineThe S&P 500 Trails the Global Stock Market by Its Widest Margin Since 1995 as President Trump's Policies Rattle InvestorsFeb 22, 2026 •By Sean WilliamsInstitutional Investors Just Sent a Historic $8.3 Billion Warning to Wall Street -- but Are Investors Paying Attention?Feb 22, 2026 •By Sean WilliamsPrediction: The Trump Bull Market Will Soon End -- and the Federal Reserve Will Be the Surprise CulpritFeb 22, 2026 •By Keith SpeightsThe S&P 500 Is Stuck.

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History Says This Could Happen Next.Feb 21, 2026 •By Adam SpataccoThe Stock Market Does This Every 4 Years. It Signals an Alarming S&P 500 Drop in 2026 If History Repeats.About the AuthorJeremy Bowman has been a contributing Motley Fool stock market analyst, covering technology, consumer goods, and macroeconomic trends since 2011.

Before The Motley Fool, Jeremy was a newspaper reporter, restaurant manager, and English teacher abroad. He holds a bachelor’s degree in English from Colorado College and a master’s degree in business administration from American University. One of his Motley Fool headlines was briefly featured on Late Night with Stephen Colbert.TMFHoboX@TMFBowmanStocks MentionedS&P 500 IndexSNPINDEX: ^GSPC$6837.75 (1.04%) $71.76Dow Jones Industrial AverageDJINDICES: ^DJI$48804.06 (1.66%) $821.91American ExpressNYSE: AXP$320.82 (7.33%) $25.36ServiceNowNYSE: NOW$100.70 (3.42%) $3.57*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.