What Happened?
A number of stocks fell in the morning session after the Trump administration's announcement of new global tariffs, reignited trade policy uncertainty. The move came swiftly after the Supreme Court ruled the previous week that the president could not use the International Emergency Economic Powers Act (IEEPA) for such duties, a decision that had initially sent markets higher. However, the administration invoked a different authority, the Trade Act of 1974, to impose a 15% global tariff for up to 150 days. The rapid reimposition of trade barriers creates significant uncertainty for companies across multiple sectors that depend on international supply chains and global trade. Investors are now weighing the potential impact of these new duties on corporate earnings and broader economic activity.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Advertising & Marketing Services company QuinStreet (NASDAQ: QNST) fell 3.6%. Is now the time to buy QuinStreet? Access our full analysis report here, it’s free.
- IT Services & Consulting company Kyndryl (NYSE: KD) fell 4.5%. Is now the time to buy Kyndryl? Access our full analysis report here, it’s free.
- Data & Business Process Services company ADP (NASDAQ: ADP) fell 3.6%. Is now the time to buy ADP? Access our full analysis report here, it’s free.
- Professional Staffing & HR Solutions company Barrett (NASDAQ: BBSI) fell 4%. Is now the time to buy Barrett? Access our full analysis report here, it’s free.
- Data & Business Process Services company EXL (NASDAQ: EXLS) fell 4.2%. Is now the time to buy EXL? Access our full analysis report here, it’s free.
Zooming In On Kyndryl (KD)
Kyndryl’s shares are very volatile and have had 22 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 10 days ago when the stock gained 7.4% on the news that the latest Consumer Price Index (CPI) report came in softer than anticipated, fueling investor optimism for interest rate cuts by the Federal Reserve. The U.S. Bureau of Labor Statistics reported that prices rose 0.2% from December to January, below the 0.3% forecast. On an annual basis, inflation moderated to 2.4%, under the expected 2.5%. This cooling trend has significant implications for monetary policy, with investors now increasing bets on multiple rate reductions by the end of the year. The news prompted a rally in both stocks and Treasuries, as lower interest rates typically reduce borrowing costs for companies and can stimulate economic activity. The Russell 2000 index, which consists of smaller companies sensitive to domestic economic conditions and financial costs, saw a particularly strong positive reaction.
Kyndryl is down 53.2% since the beginning of the year, and at $11.92 per share, it is trading 72.5% below its 52-week high of $43.41 from July 2025. Investors who bought $1,000 worth of Kyndryl’s shares at the IPO in October 2021 would now be looking at an investment worth $292.52.
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