The search for a breakout catalyst amid the ongoing angst tied to the future of AI technologies continues. But in the opening months of the year investors have another item on the list of market complexities

The U.S. is building its most significant presence in the Persian Gulf region since the 2003 Iraq war, with aircraft carriers and fighter jets poised to strike targets in Iran if talks to curb its nuclear ambitions ultimately break down.

Global oil prices have been moving firmly higher on the threat, with Brent crude futures trading firmly north of $71 a barrel and WTI now some 20% higher over the past two months.

Whether President Donald Trump decides to order the strikes, or is using the optics of military might to strengthen his negotiating position, is impossible to say.

And that uncertainty is leaking into investor sentiment as markets continue to grapple with both the ongoing tech selloff and a Federal Reserve that is willing to ponder interest-rate hikes in the face of stubborn inflation pressures.

Which won't, of course, be helped by the current rise in crude prices or the likely upheaval in tariff schedules should the Supreme Court rule against the president's use of emergency powers to justify sweeping levies on U.S. trade partners.

That could be why stocks aren't able to hold on to any significant rally of late, nor consolidate those advances into a string of consistent gains that could take the S&P 500 past the 7000-point mark. Volatility gauges remain muted, but are closing at ever higher levels, suggesting the current market calm could be broken at any time. A U.S. attack on Iran, when the Middle East remains simmering with resentment amid tensions between Israel and Hamas, seems like the kind of event that could do just that.

-- Martin Baccardax

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Fed Meeting Minutes Put Rate Hikes Back on Table

Federal Reserve officials were divided over their next move after leaving the benchmark interest rate unchanged at their January meeting. Some believed that rates might be adjusted lower if inflation keeps declining, while others considered it appropriate to hold the policy rate steady as they assessed more data.

   -- But most policymakers worried that the path to getting inflation down to 
      the 2% target might be slower and more uneven than expected and thought 
      that the risk of inflation staying above 2% was meaningful, according to 
      the Jan. 27-28 Fed meeting minutes released Wednesday. 
 
   -- After three straight rate cuts late last year, several policymakers 
      thought further cuts may not be warranted without clear evidence of 
      disinflation. Some even raised the possibility of an actual rate increase 
      if inflation stays above that 2% target. 
 
   -- Unexpectedly strong January jobs data -- payrolls rose 130,000 and 
      unemployment fell to 4.3% -- have reinforced arguments for patience on 
      cuts. Fed governor Michael Barr said Tuesday that when productivity 
      increases, potential output, growth, and business investments also 
      increase, suggesting a higher rate of inflation. 
 
   -- Officials including Fed governor Stephen Miran, a former White House 
      official, have said the Fed relies too much on backward-looking data, 
      overstating housing inflation, and underestimating productivity gains 
      from artificial intelligence and deregulation. Trump's nominee for Fed 
      chair, Kevin Warsh, has been similarly critical. 

What's Next: When Fed officials release the updated Summary of Economic Projections after their March meeting, investors will look for signs that confidence in productivity gains has begun to show up in the forecasts or whether caution still dominates the committee's outlook.

-- Nicole Goodkind and Janet H. Cho

New York Fed's Tariff Research Draws Administration's Ire

Researchers at the New York Fed have become the latest targets of attacks by a Trump administration official after publishing an analysis that contradicts the White House's messaging around tariffs. Specifically, they found that U.S. businesses and consumers have shouldered most of the costs of tariffs.

   -- That's in line with other research -- from the Budget Lab at Yale, 
      Goldman Sachs, the Tax Foundation, the German-based Kiel Institute for 
      the World Economy -- and academic research published by the National 
      Bureau of Economic Research. Companies have talked about the costs over 
      the past year. 
 
   -- But White House National Economic Council Director Kevin Hassett disputed 
      the findings and said researchers involved should be disciplined for 
      putting out a conclusion that created highly partisan news based on 
      "analysis that wouldn't be accepted in a first semester econ class." The 
      New York Fed declined to comment. 
 
   -- Hassett said that the New York Fed researchers were only looking at 
      changes in prices, assuming that import volumes haven't shifted. He also 
      pointed to recent economic readings that have shown less inflation in 
      recent months. In January, the CPI rose by 2.4% year over year, moving 
      closer to the Fed's 2% target. 
 
   -- The New York Fed's analysis, based on models developed to track the 
      2018-2019 tariffs and effects on goods prices, does factor for both 
      prices and import volumes. It found that 94% of the tariff incidence was 
      borne by the U.S. businesses and consumers in the first eight months of 
      2025. 

What's Next: Hassett's comments follow a familiar pattern from the Trump White House, which has worked to discredit and sometimes remove officials whose messaging doesn't fit with administration priorities. Claudia Sahm, chief economist for New Century Advisors and a former Fed economist, called Hassett's comments "deeply disturbing."

-- Megan Leonhardt

eBay Has $1.2 Billion Deal for Platform Popular With Gen Z

The online platform operator eBay struck a $1.2 billion deal to buy the secondhand clothing sales site Depop, in a bid for younger Gen Z shoppers. Nearly 90% of Depop's 7 million active buyers are under age 34. The seller, online artisan marketplace Etsy, is refocusing on its core customer.

   -- Depop has been growing in popularity, with annual gross merchandise sales 
      of about $1 billion in 2025, including nearly 60% growth in the U.S. from 
      the prior year. It had more than 3 million active sellers, the companies 
      said. Etsy bought Depop for $1.62 billion in 2021. 
 
   -- E-commerce sites like Etsy are still adjusting after the pandemic-era 
      boom in online shopping. The company is known for its marketplace that 
      offers arts and crafts made by small businesses. 
 
   -- eBay CEO Jamie Ianonne highlighted the chance to broaden the company's 
      reach to younger customers and the growing "recommerce" trend in retail. 
      Ianonne said the acquisition gives eBay the opportunity to advance one of 
      its newest and fastest-growing categories. 
 
   -- The transaction is expected to close in the second quarter, and Depop 
      said it will keep its name, brand, and platform. On its website, Depop 
      says it is trying to popularize secondhand fashion and resale culture in 
      the U.K., the U.S., Australia, and elsewhere. 

What's Next: eBay beat expectations with fourth-quarter adjusted earnings of $1.41 a share and revenue of $2.96 billion, up 15% from a year earlier. For the first quarter, it projects adjusted earnings of $1.53 to $1.59 a share and revenue of $3 billion to $3.05 billion.

-- Janet H. Cho

Carvana Sales Surge, But Murky Outlook Disappoints

Carvana, the used car seller famous for its vehicle vending machines, offered a murky outlook on the year ahead that disappointed investors, who sent the shares down 21% in after-hours trading. That comes after surging sales in 2025, with investors hoping for more on management's industry outlook and pricing trends.

   -- Instead, Carvana said it was prioritizing the same objectives it had last 
      year: boosting sales, increasing profit, and improving the customer 
      experience. Carvana said it expects "significant growth" in sales and 
      profit this year, "assuming the environment remains stable." And it 
      warned of the increased costs to recondition vehicles. 
 
   -- For the fourth quarter, Carvana reported adjusted earnings before 
      interest, taxes, depreciation, and amortization of $511 million, which 
      was below expectations. Revenue totaled $5.6 billion, up 58% from a year 
      ago. The company sold 163,522 vehicles at retail in the quarter. 
 
   -- The sales numbers brought its year-end total to 596,641 cars, up 43% from 
      2024. It said its 2026 priorities include putting additional emphasis on 
      significant profitable growth at scale. It forecasts a sequential 
      increase in retail units sold and adjusted profit in the first quarter. 
 
   -- Carvana has been working to build its supply of cars available for sale 
      and to speed up the delivery time of those vehicles to customers while 
      making shipping distances shorter, as MarketWatch reported. It also faces 
      competition from Amazon, which has its own vehicle sales platform. 

What's Next: CEO Ernie Garcia told analysts that Carvana has increased customer selection by 20,000 cars in the past year, delivered cars a full day faster, and cut shipping fees an average of $60. The current goal is the sale of 3 million retail units a year and a 13.5% adjusted margin.

-- Nate Wolf and Liz Moyer

Hope for Moderna's Flu Vaccine in FDA U-Turn

The flip-flop was swift. The Food and Drug Administration seems to have changed its tune on Moderna's application for its new seasonal flu vaccine. The pharma company said Wednesday the FDA had reversed course and initiated a review of its seasonal flu vaccine candidate, mRNA-1010.

   -- The company is seeking full approval of mRNA-1010 for adults aged 50 to 
      64 and accelerated approval for adults 65 and older. If approved, the 
      vaccine would be available by the 2026-2027 flu season. 
 
   -- Moderna met with FDA officials after the agency last week issued a 
      "refusal-to-file" letter rejecting the vaccine candidate. It noted the 
      application didn't contain a trial that was "adequate and 
      well-controlled." 
 
   -- FDA spokesman Andrew Nixon told Barron's on Wednesday the agency held a 
      Type A meeting with Moderna, defined as a high-priority discussion 
      specifically designed to resolve roadblocks in drug development. 

What's Next: It's not known when a decision is expected, but the FDA is evaluating the amended application. The 2026-27 flu season begins in October, according to the Centers for Disease Control and Prevention $(CDC)$.

-- Mackenzie Tatananni, Rupert Steiner , Patrick O'Donnell

-- Newsletter edited by Liz Moyer, Patrick O'Donnell, Rupert Steiner

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(END) Dow Jones Newswires

February 19, 2026 06:25 ET (11:25 GMT)

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