Court Ruling Blocks Trump's Tariffs, Global Markets See Respite

Strategic Insights -

A federal court blocked President Donald Trump's plan to impose tariffs on imports under an emergency-powers law, casting doubt on the administration's trade policies that have jolted global financial markets. The three-judge panel ruled that the 1977 International Emergency Economic Powers Act does not authorize the use of tariffs. The Trump administration filed an appeal, and it is unclear if the White House will pause its emergency power tariffs in the interim. The ruling has given traders a brief respite, with Asian shares advancing and U.S. futures jumping.

Key Takeaways:

  • The court ruling blocks President Trump's plan to impose tariffs on imports under an emergency-powers law, citing that the 1977 International Emergency Economic Powers Act does not authorize the use of tariffs.
  • The ruling has given traders a brief respite, with Asian shares advancing and U.S. futures jumping.
  • The Trump administration filed an appeal, and it is unclear if the White House will pause its emergency power tariffs in the interim.
  • The ruling has raised uncertainty over the outlook for inflation and the global economy.
  • Many of Trump's double-digit tariff hikes are paused for up to 90 days to allow time for trade negotiations.
  • The futures for the S&P 500 was up 1.6%, while the Dow Jones Industrial Average gained 1.2%.
  • The Nikkei 225 index jumped 1.5% to 38,263.36.
  • The Bank of Korea cut its key interest rate to 2.5% from 2.75% to ease pressure on the economy.
  • Shares of Nvidia jumped 4.9% in after-hours trading.
  • Several other retailers delivered better-than-expected results for the latest quarter, including Abercrombie & Fitch, which soared 14.7%.
  • Dick's Sporting Goods added 1.7% after topping analysts' expectations for the latest quarter.

Statistics:

  • The 1977 International Emergency Economic Powers Act does not authorize the use of tariffs, according to the court ruling.
  • The futures for the S&P 500 was up 1.6% and the Dow Jones Industrial Average gained 1.2%.
  • The Nikkei 225 index jumped 1.5% to 38,263.36.
  • The yield on the 10-year Treasury rose to 4.47% from 4.43% late Tuesday.
  • The dollar slipped sharply against the Japanese yen, trading at 146.06 yen early Thursday.
  • Brent crude, the international standard, added 56 cents to $64.88 per barrel.
  • U.S. benchmark crude oil gained 60 cents to $62.44 per barrel.

Sources:

  • Elaine Kurtenbach, AP Business Writer
  • Matt Ott and Stan Choe, AP Business Writers
  • Stephen Innes, SPI Asset Management