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The US stock market recovered sharply on February 20, after the Supreme Court overturned President Trump’s tariffs in a 6-3 ruling. The S&P 500 is trading 0.45% higher than yesterday’s close at the time of writing.
Technology (XLK) is leading the recovery in rate relief, while energy (XLE) returns early gains despite higher oil prices. Alphabet (GOOGL) stands out almost independently with a 3.8% rally as it attempts to break out of a bearish pattern.
The most important news from the US stock market:
Wall Street recovers from stagflation fears as tariff decision sparks rebound in sanctions relief
Wall Street experienced one of the most dramatic intraday reversals on February 20, 2026. The morning began with panic as “the flood of data” presented a stagflation-like mix.
Advance Q4 GDP Slows Sharply to 1.4% (well below consensus of 2.8%), while core PCE accelerated to 3.0% year over year, its highest reading since mid-2025. S&P 500 futures fell immediately after the 8:30am EST release.
But the atmosphere changed in the middle of the session when… The Supreme Court struck down the emergency tariffs imposed by President Trump in a historic majority decision. 6-3. Markets interpreted the decision as a major catalyst for future deflation.
The S&P 500 is trading at around 6,890 at the time of writing, up 0.45% from yesterday’s close. Also, the index is now approaching a strong zone near 6,888.
A sustained movement above this level opens the way to 6,959, and the establishment can open the way for the index to achieve psychological completion at 7,000.
On the upside, 6,775 is the main support to watch. A break below this level would signal weakness towards 6,707.
However, a positive belief is not without risk. Experts have already indicated that the rate decision may not be the last word – the administration may pursue alternative rate mechanisms, which could influence sentiment as the session progresses.
A major resistance move still requires a push of about 1% from current levels.
The Nasdaq leads the recovery, at 172 points (0.76%), while the Dow is at 68 points at the time of writing.
The CBOE Volatility Index (VIX) fell sharply, falling by about 5%. A move below 20 indicates that the initial fear of stagflation has subsided and the market is returning to a cautiously optimistic stance.
The conflict is clear: stagflation data drags markets down, and easing rates lifts them. Now let’s go to the sectors.
Technology is up while energy is down, but build a positive argument
The history of the sector on February 20, 2026 takes an unexpected turn. Surface numbers tell one story, but graphs tell another.
Technology ( XLK ) rose 0.36% to $140.72, Benefiting from the cancellation of customs duties imposed by the Supreme Court Low import costs directly support hardware and semiconductor supply chains.
However, the demonstration makes a ceiling in the arena. XLK tried to break above the $141.29 resistance, but sellers intervened. A daily close above this level is needed to open the way towards $144.78 and eventually the $149-150 area.
Not holding above $139 will transform the short-term bearish structure. Easing rates provide a catalyst for the US stock market, but with core personal consumption at 3.0%, fueling higher interest rates for the longest time, technology valuations remain under pressure.
Energy (XLE) tells the opposite story. The sector looked strong as the tensions between the United States and Iran pushed oil higher: the WTI index kept above $ 66 and Brent above $ 71. But the gains eased during the session, with XLE down 1.09% since yesterday.
However, the XLE chart tells a more constructive story under the red side. It looks like the ETF is in the process of consolidating into a bull flag. If it confirms a break above $55.90, it could target $60.29 – a move of about 10%.
The total movement formed by the previous stage predicts a potential increase of 27%. A price drop below $53.19 will invalidate this setup.
Alphabet (GOOGL) is rising while the Bears are losing cohesion
Alphabet (GOOGL) was the biggest mover in the US stock market on February 20, 2026, rising about 3.8% to about $316. The stock showed a continuous buying impulse without a noticeable higher fuse, an indication that the sellers did not intervene to identify a rebound.
The move is notable because Alphabet has been trapped in a bearish flag pattern after pulling from its highs in early February. Today’s rally is trying to break this bearish structure, reversing from the support area between $296 and $300 and pushing towards the cancellation of the pattern.
However, Alphabet is not out of the woods yet. A sustained move above $327 – extending to $330 – is needed to invalidate the entire bearish setup and confirm a larger bullish reversal. Until those levels are crossed, the risk of a breakout failure remains real.
On the downside, a drop below $304 will weaken the breakout attempt and re-enter bearish pressure. Additional weakness below $296 could accelerate selling, possibly retesting lower support and resuming a bearish flag pattern – erasing the entirety of the day’s gains.
In telecommunications services, Alphabet leads while Meta is also gaining as more than 51% of the shares are in the green.
While other sectors settle for muted moves, Alphabet’s big standalone growth suggests dip buyers are firmly positioned in AI-related growth names.
