Recap | 23 February 2026
- 15 hours ago
- 8 min read
Negotiations to continue on Thursday amid heightened US-Iran tension
Prospective US tariffs introduce new uncertainties
Trading partners revisit deals after SCOTUS ruling
US broaching nuclear dialogue with Russia, China
AI disruption potential weighs on technology services as stocks fall
Fed Governor Waller weighs support for interest rate pause
US factory orders retreat as NY Fed inflation gauge climbs
AP highlights growing clout of retail investors
Mexico wages war against Jalisco New Generation Cartel
EU's Russia sanctions, loans for Ukraine blocked by Hungary
Brazil signs strategic agreements with India, South Korea
Federal court leaves Utah redistricting map in place
FTC and DOJ address data-sharing among competitors
Supreme Court agrees to hear challenge to states' climate suits
President Trump to deliver State of the Union address to Congress
EDWARD VON DER SCHMIDT
Headlines
Negotiations to continue on Thursday amid heightened US-Iran tension
With the US steadily building up military assets in the Middle East and Iran bolstering its defenses, both are scheduled to meet on Thursday in Geneva for another round of mediation hosted by Oman. On Monday, the State Department ordered the evacuation of nonessential personnel from Lebanon as student-led protests resumed in Tehran.
After the Wall Street Journal reported on a risk assessment presented by the Pentagon, President Trump demurred on the likelihood of strikes - without ruling them out - and expressed a preference for a deal. Iranian officials have stated that a draft proposal is forthcoming, but the country intends to continue local enrichment of uranium - a US red line.
Sources:
Next US-Iran nuclear talks are Thursday in Geneva as Washington awaits proposed deal from Tehran (AP; 2/22)
State Department orders nonessential US diplomats to leave Lebanon as tensions with Iran roar (AP)
US military builds up the largest force of warships and aircraft in the Middle East in decades (AP)
Tehran is ready for nuclear concessions if US meets demands, Iranian official says (Reuters; 2/22)
Iranian students protest for third day as US pressure mounts (Reuters)
US pulling non-essential staff from embassy in Beirut amid Iran tensions (Reuters)
Trump Said Iran Strike Would Be 'Easily Won' But Prefers Deal (Bloomberg)
Pentagon Flags Risks of a Major Operation Against Iran (WSJ)
Anxiety Builds as Iranians Brace for Looming War With U.S. (WSJ)
Prospective US tariffs introduce new uncertainties
The Trump administration announced new Section 122 tariffs following the Supreme Court's decision that the use of IEEPA tariffs was unconstitutional; President Trump announced an increased rate of 15% (from 10%) on Saturday. The statute allows for temporary executive measures to address certain economic conditions but has not been used for tariffs before (Bloomberg).
In addition, the US Trade Representative intends to initiate a host of investigations under Section 301 of the Trade Act of 1974, which addresses unfair practices. Such tariffs were levied against China during Trump's first term. The Commerce Department will also investigate additional sectors vis-a-vis Section 232 tariffs (WSJ), which are geared toward protecting national security interests.
The new measures have introduced uncertainty as to the extent and degree to which they will be implemented. The administration intends to make up for anticipated revenue lost due to the Supreme Court ruling.
Sources:
Trump says he'll raise tariffs to 15 percent after Supreme Court ruling (AP; 2/21)
USTR expects new Section 301 probes to cover most major trading partners (Reuters; 2/21)
Trump warns countries that 'play games' with US trade deals will face higher tariffs (Reuters)
Trump Charts New Trade Path After Supreme Court Blocks Key Tariff Hammer (Bloomberg; 2/21)
All About Section 122, Trump's New Go-To Tariff Provision (Bloomberg)
Exclusive: Trump Considers New National Security Tariffs After Supreme Court Ruling (WSJ)
See also:
US tariff turmoil leaves Treasury markets dazed (Reuters)
Global Trade Confusion Returns as Trump Shifts Tariff Tools (Bloomberg)
What to Know About Tariff Refunds After the Supreme Court Decision (Bloomberg)
Here Are (Some) Answers to Your Biggest Tariff Questions (WSJ)
What to Know About Trump's New Tariff (WSJ)
Trading partners revisit deals after SCOTUS ruling
Notwithstanding warnings from the US, who expects counterparties to "stand by" terms, many trading partners intend to reassess deals struck under the prior tariff regime. European Parliament postponed a vote in order to gain "clarity", and the EU expressed reservations that newly announced tariffs violated terms of the agreement under consideration.
G7 trade ministers held a call to discuss the ruling. China, India, and South Korea are also evaluating how the SCOTUS decision affects their negotiating posture and recent trade agreements with the US.
Sources:
EU hits pause on US trade deal as it seeks clarity over latest Trump Maneuver (AP)
EU lawmakers again postpone vote on US trade deal after tariff upheaval (Reuters)
China assessing US Supreme Court tariff ruling; says "fighting is harmful" (Reuters)
EU Halts US Trade Deal as Tariff Turmoil Creates Uncertainty (Bloomberg)
EU Warns That Trump's New Tariff Policy Breaks Trade Agreement (Bloomberg)
India Sees More Options on US Trade Deal After Tariff Ruling (Bloomberg)
US Tells Partners to Honor Tariff Deals as Trump Regroups (Bloomberg)
US broaching nuclear dialogue with Russia, China
Following the lapse of New START, a US delegation attending the U.N. Conference on Disarmament in Geneva met with Russian counterparts on Monday and will meet with representatives from China on Tuesday. It is not clear whether these discussions constitute formal multilateral negotiations regarding nuclear arms control.
US officials have maintained that any new agreement with Russia should include China as well.
Sources:
US sheds light on its allegation of Chinese nuclear test and urges nations to push for disarmament (AP)
US meeting Russian and Chinese delegations for nuclear arms control talks, official says (Reuters)
US Nuclear Arms Control Delegation to Meet Chinese Counterparts in Geneva (Bloomberg)
Markets & Economies
AI disruption potential weighs on technology services as stocks fall
Information service providers deemed vulnerable to advances in AI weighed on US equity indices Monday amid broader tariff uncertainty. Losses were reportedly aggravated by research reports highlighting industry exposure.
Sources:
Supreme Court decision against Trump's tariffs raises uncertainty, but markets stay calm (AP; 2/22)
US stocks drop after Trump ramps up his tariffs and worries flare about potential AI losers (AP)
Wall Street ends sharply lower amid AI displacement fears and revived tariff angst (Reuters)
Stocks Hit by AI-Disruption Fears as IBM Tumbles; Markets Wrap (Bloomberg)
Viral Doomsday Report Lays Bare Wall Street's Deep Anxiety About AI Future (WSJ)
Fed Governor Waller weighs support for interest rate pause
In a speech on Monday, Federal Reserve Governor Waller indicated that he may support a pause at the March meeting on account of stronger-than-expected jobs data.
Comment:
Governor Waller dissented in favor of a 25bp cut at the January meeting. If one of the more vocal advocates for easing is backing off, near-term cuts would appear increasingly unlikely before June - at the earliest.
Sources:
Fed's Waller says rate cut in March is a 'coin flip' following a strong US jobs report (AP)
Fed's Waller: January jobs data an upside surprise, if it continues a policy pause may be appropriate (Reuters)
Waller Weighs Supporting Fed Rate Pause if Labor Data Stabilize (WSJ)
US factory orders retreat as NY Fed inflation gauge climbs
A drop in the aircraft sector belied underlying strength in December factory orders, which were released on a delay.
Separately, the latest New York Fed statistical gauge of core inflation climbed to 2.8% year-over-year in December, from 2.4% in November.
Comment:
Resilient economic activity and labor markets coupled with above-target inflation will keep the Fed on hold until compelled otherwise.
Sources:
US factory orders fall in December on commercial aircraft bookings (Reuters)
New York Fed inflation measure heats up in December (Reuters)
AP highlights growing clout of retail investors
The Associated Press highlighted the substantial pickup in retail ETF trading activity, with individual investors increasingly active in options markets.
Source:
From dabblers to day traders, individual investors' impact on Wall Street grows (AP)
Around the World
Mexico wages war against Jalisco New Generation Cartel
Mexican armed forces killed the head of the Jalisco New Generation Cartel - the country's largest drug syndicate - in a raid this weekend. The operation obviated direct US intervention but involved assistance from the new U.S. Joint Interagency Task Force-Counter Cartel.
Sources:
What to know about the killing of the powerful cartel leader 'El Mencho' in Mexico (AP)
Exclusive: New US military-led group aided Mexico's hunt for 'El Mencho' cartel boss (Reuters)
Mexico Details How It Took Out Its Most-Wanted Cartel Chief (Bloomberg)
Mexico Races to Prevent Cartel War After the Killing of Top Drug Boss (WSJ)
EU's Russia sanctions, loans for Ukraine blocked by Hungary
A 20th package of sanctions against Russia failed to garner EU support after Hungary blocked the measures along with an agreed-upon loan to Ukraine. Slovakia has also suspended power deliveries given an ongoing dispute over resuming operations of the Druzhba pipeline, which transports Russian oil to Eastern Europe.
Separately, a Ukrainian official indicated that the next round of talks with Russia could be held at the end of the week (Reuters); no talks have been confirmed. Perhaps more interestingly, the official's characterization of the Russian delegation's professionalism might indicate progress.
Sources:
EU fails to pass new sanctions targeting Russia after Hungary objects (AP)
Slovakia halts emergency electricity supplies to Ukraine amid oil delivery dispute (AP)
Slovakia to stop emergency power supplies to Ukraine over oil dispute, PM says (Reuters)
Hungary blocks Russia sanctions, EU cash for Kyiv on eve of Ukraine war anniversary (Reuters)
See also:
Next round of Ukraine peace talks could be this week, Kyiv says (Reuters)
Ukraine reconstruction estimate jumps 12% to $588 billion, World Bank says (Reuters)
Russian lives for Ukrainian lands (Reuters)
Brazil signs strategic agreements with India, South Korea
Following last week's AI summit, Indian Prime Minister Modi hosted Brazilian President Lula to sign memoranda of understanding to include cooperation on rare earths and critical minerals sourcing.
President Lula signed similar agreements with South Korean President Lee on Monday.
Comment:
Countries are increasingly looking to bilateral agreements and regional cooperatives to diversify trade and critical input sources.
Sources:
Brazil and India agree to boost cooperation on rare earths (AP; 2/21)
India, Brazil sign mining pact as Modi targets $20 billion trade in five years (Reuters; 2/21)
South Korea and Brazil agree to expand cooperation in key minerals, trade (Reuters)
Odds & Ends
Federal court leaves Utah redistricting map in place
A federal court ruling in Utah retained a judicially-approved map that may potentially turn a House seat in Democrats' favor in the November midterm elections.
Comment:
Barring a wave, every seat is likely to count given the close margins in the House at present and the implications of a change of control in Congress.
Sources:
Federal court rejects GOP-led Utah Legislature's latest try to block House map that helps Democrats (AP)
FTC and DOJ address data-sharing among competitors
The Federal Trade Commission and Department of Justice will seek public comment regarding information-sharing among competitors, a particular concern given the proliferation of aggregation services.
Comment:
The risk of competitors sharing information is that they may collude to the detriment of customers, suppliers, and other stakeholders.
Sources:
US antitrust enforcers to revamp guidelines on rivals collaborating (Reuters)
US Regulators Plan Guide for When Business Rivals Can Share Data (Bloomberg)
Supreme Court agrees to hear challenge to states' climate suits
The Supreme Court agreed to hear arguments from oil companies challenging the ability to bring climate change-related lawsuits under state laws (as opposed to federal).
Sources:
US Supreme Court to hear bid by oil companies to toss climate suits (Reuters)
Oil Companies Get Supreme Court Hearing on Climate Suits (Bloomberg)
President Trump to deliver State of the Union address to Congress
President Trump will deliver the State of the Union address at 9pm ET on Tuesday. He intends to speak at length.
Sources:
How Trump will use his State of the Union address to sell skeptical midterm voters on his plans (AP)
How the State of the Union became a stage for political confrontation (Reuters; 2/21)
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