US Stocks Plunge Amid Tariff Threats and Earnings Reports

Market Selloff and Volatility

• 📉 US equity markets experienced a massive selloff, with the S&P 500 hitting its lowest level of the session and nearing its 100-day moving average.
• ⚠️ The selling was broad-based, affecting nearly all sectors, with information technology and consumer discretionary taking significant hits.
• 📈 The S&P 500 saw its biggest drop since October 2025, erasing its year-to-date gains, while equity volatility jumped to its highest since November.
• 📊 Volume was significantly higher than the 30-day average, indicating strong investor activity during the downturn.

Geopolitical and Economic Factors

• 🌍 Renewed geopolitical tensions, including threats of tariffs on European countries, contributed to the market decline.
• 📉 Investors reacted to a rout in Japanese bonds and news of a Danish pension fund exiting Treasuries, impacting US yields.
• 💰 The US dollar also slid against most major currencies amidst these global economic shifts.

Company Earnings and Outlooks

• ✈️ United Airlines reported better-than-expected fourth-quarter earnings and revenue, anticipating a strong 2026 driven by demand for premium and international travel.
• 🎬 Netflix announced fourth-quarter revenue and EPS beats but issued a cautious 2026 revenue outlook, leading to a dip in after-hours trading.
• 💰 Netflix plans to increase spending on programs by 10% this year, with a significant portion allocated to non-English language titles and potential acquisition costs, while pausing share buybacks.
• ⚠️ Investors are questioning Netflix's increased spending and its impact on future subscription price increases and profitability.

Sector Performance

• 💻 Information Technology was the biggest drag on the market, down approximately 3% as a sector.
• 🛒 Consumer Discretionary and Financials also experienced significant declines.
• 🍎 Consumer Staples was the only sector managing a slight gain, up about a tenth of a percent.