White House & Policy - February 28, 2026 (EOD)

 ## Policy Recap The administration today took decisive actions impacting both foreign policy and domestic economic sectors. Most notably, the president authorized coordinated military strikes against Iran alongside Israeli forces, escalating geopolitical tensions in the Middle East. This move was accompanied by a directive for all federal agencies to cease use of Anthropic's AI technology, citing national security concerns and labeling the company a supply chain risk. This executive order signals a tightening of government scrutiny over AI vendors and reflects growing caution in technology procurement policies. On the legislative front, Congress remained largely quiet, with no major bills advancing that directly influenced market sentiment today. However, ongoing discussions around labor reforms in Argentina and tariff-related issues in U.S. agriculture were noted but did not generate immediate market impact. The administration's focus on national security and technology policy dominated the session, with markets closely monitoring the implications of the Iran strikes and AI vendor restrictions. Throughout the trading day, markets digested these developments with heightened volatility. The geopolitical escalation triggered risk-off behavior early in the session, while the AI vendor ban raised concerns in the tech sector. The administration’s firm stance on AI security and Middle East policy set the tone, overshadowing other economic data and corporate earnings releases. ## Market Reaction The broad market closed lower amid the policy-driven uncertainty. The S&P 500 declined 0.48% to $685.99, the Nasdaq 100 fell 0.63% to $605.38, and the Dow Jones dropped 1.05% to $489.66. Small caps underperformed with the Russell 2000 down 1.72%, reflecting investor caution toward riskier assets. Bond markets responded with a modest rally in long-duration Treasuries, as the 20+ Year Treasury ETF (TLT) rose 0.55% to $90.77, signaling a flight to safety. The U.S. dollar showed little change, with the UUP ETF down marginally by 0.07%, suggesting that the risk-off sentiment was more equity-centric. Intraday swings were pronounced around the timing of the Iran strikes and the announcement of the AI technology ban. Early session weakness gave way to brief rebounds in energy and defense-related stocks, but tech stocks remained pressured. Overall, risk sentiment shifted toward caution, with investors favoring defensive sectors and safe-haven assets like gold, which gained 1.31% to $483.75. ## Sector Scorecard - **Financials (XLF):** Declined 2.04% to $51.43 as geopolitical uncertainty and tech sector weakness weighed on banking and financial services stocks. Notably, **$GS** fell 7.48%, and **$MS** dropped 6.20%, reflecting concerns over credit risk and market volatility. - **Energy (XLE):** Gained 1.58% to $55.92, benefiting from the heightened geopolitical risk premium on oil prices. Crude oil futures surged 2.73% to $81.95, driven by fears of supply disruptions in the Gulf region. - **Industrials (XLI):** Rose modestly by 0.25% to $177.14, supported by defense contractors like **$LMT** (+2.70%), **$RTX** (+2.62%), and **$NOC** (+2.24%) on expectations of increased government spending amid the Middle East conflict. - **Technology (XLK):** Fell 1.60% to $138.76, pressured by the administration’s ban on Anthropic’s AI technology and broader concerns about regulatory scrutiny in the sector. Key tech names such as **$AAPL** dropped 3.44%, and **$NVDA** declined 3.83%. - **Healthcare (XLV):** Advanced 1.77% to $160.20, reflecting a flight to defensive sectors amid market volatility. Biotech and pharmaceutical stocks like **$GILD** (+3.46%) and **$AMGN** (+1.49%) outperformed. ## Winners & Losers ### Today's Policy Winners **$DELL** +21.53% - Strong earnings report and dividend hike overshadowed market weakness, benefiting from increased demand for enterprise technology amid geopolitical uncertainty. **$FIGS** +23.50% - Surged on bullish analyst commentary amid a defensive consumer healthcare backdrop. **$APA** +4.57% - Energy sector gains from rising oil prices due to Middle East tensions. **$LMT** +2.70% - Defense contractor rally on expectations of increased military spending following Iran strikes. **$GILD** +3.46% - Healthcare sector strength amid risk-off sentiment. ### Today's Policy Losers **$GS** -7.48% - Financial sector hit by risk-off sentiment and concerns over credit exposure. **$AXP** -7.83% - American Express declined sharply amid financial sector weakness and geopolitical uncertainty. **$WFC** -5.80% - Wells Fargo sold off on broader banking sector pressure. **$DNA** -31.41% - Biotech stock plunged despite sector strength, possibly due to company-specific issues overshadowing policy impact. **$ZS** -12.61% - Cloud security firm heavily impacted by the administration’s AI vendor restrictions. ## Trade & Tariff Update No new trade or tariff developments were reported today. However, the ongoing geopolitical tensions in the Middle East are expected to keep import/export sensitive companies on alert, particularly those reliant on energy and shipping routes through the Gulf. Energy stocks reacted positively to supply concerns, but broader trade-related policy remains unchanged. ## Tomorrow's Policy Calendar - The president is scheduled to deliver a Saturday morning address, likely providing further details on the Iran strikes and U.S. strategy. - Congressional committees may hold hearings on AI security and technology procurement policies following the Anthropic ban. - Pending executive orders on AI vendor risk management are expected to be clarified. - Market participants will watch for any legislative updates on tariffs or trade policy amid global supply chain concerns. - Key economic data releases include February Non-Farm Payrolls, which will be scrutinized for signs of labor market stability amid geopolitical risks. --- This session underscored the market’s sensitivity to U.S. foreign policy decisions and executive actions on technology security. The Iran strikes and AI vendor ban drove sector rotations and risk sentiment shifts, setting the tone for cautious trading ahead. Investors will closely monitor the administration’s next moves and congressional responses as geopolitical and regulatory risks evolve.