US stocks fell as tariff uncertainty increased. The Dow dropped about 700 points (1.45%). The S&P 500 fell 0.6%, and the Nasdaq lost 0.7%. The US raised a Section 122 global tariff from 10% to 15% after the Supreme Court struck down tariffs under IEEPA. The 15% tariff can last up to 150 days unless Congress extends it. The US also plans new Section 301 probes.

Market Volatility And Tariff Risk

Novo Nordisk shares fell as much as 16% after CagriSema underperformed in the REDEFINE 4 trial versus Eli Lilly’s tirzepatide. After 84 weeks, weight loss was 20.2% for CagriSema versus 23.6% for tirzepatide. Eli Lilly rose about 3%. Oracle and Palantir fell about 4%. American Express dropped roughly 5–7%. The iShares Software ETF is down about 20% year-to-date. Nvidia rose about 1.7%. Earnings expectations are $1.53 per share on $65.7 billion in revenue. Gilead will buy Arcellx for $7.8 billion. Arcellx jumped nearly 80% to about $115 per share, plus a $5 contingent value right (CVR). Gold rose more than 1% to about $5,168 per ounce, and silver climbed toward $88. Bitcoin fell to about $65,000. Domino’s reported $1.54 billion in revenue, with 3.7% US same-store sales, and shares rose about 5%. New global tariffs are raising uncertainty and driving a jump in market fear. The CBOE Volatility Index (VIX) is up more than 20% this week and is trading above 22. That level is similar to the trade-war tension seen in 2019. To help limit downside risk, we should consider SPY puts or VIX call options in case trading partners respond with their own measures. Novo Nordisk’s sharp 16% drop also highlights a clear split versus Eli Lilly, which now looks like the stronger leader in weight loss. Implied volatility on Novo options has climbed above 60%, which points to more large moves ahead. One way to use this gap is a pairs trade: buy puts on NVO and calls on LLY, aiming to profit if the performance difference keeps widening.

Software Rotation And Earnings Setup

There is a major shift away from legacy software. Tech funds reported more than $5 billion in outflows from the sector last month alone. The decline in names like Oracle and American Express may have further to go, which makes puts on the IGV software ETF a useful hedge. For Nvidia’s earnings on Wednesday, a straddle can help position for a big move in either direction, since it focuses on volatility rather than direction. Gilead’s Arcellx deal is a long-term move into cell therapy, not a short-term trade. The announcement is now largely priced into Arcellx. However, the small dip in Gilead could offer a lower-cost entry for long-dated call options. The main catalyst is the FDA decision on anito-cel in December, so options expiring in early 2027 may fit the timeline. The move to safety is clear, with gold pushing above the key $5,100 level. As long as tariff tension stays high, we should consider adding exposure through calls on the GLD and SLV ETFs. Bitcoin is still trading like a risk asset and is down nearly 15% year-to-date. Puts on crypto-related ETFs can help hedge this risk-off setup. Create your live VT Markets account and start trading now.

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