Stock markets in the United States, Canada, Europe and Asia rose on Friday after the Supreme Court struck down U.S. President Donald Trump’s tariffs, a key pillar of the administration’s economic platform. U.S. Treasury yields rose modestly.
U.S. Supreme Court ruling overturning Trump nudges up stocks, could spook bond vigilantes
Here’s how market strategists, economists and major investors are reacting:
DAVID ROSENBERG, FOUNDER OF ROSENBERG RESEARCH:
“The stock market loves it, but then again, it also loved the levies because it was the “stick” that was used to entice all the “deals” that allegedly were going to trigger a wave of direct investment inflows in support of economic growth and profits. What happens to all of this now? And what is the next move by the White House in terms of circumventing the Supreme Court ruling? Because there are other avenues to draw from. Again, what the stock market isn’t looking at is the new uncertainty unleashed by a trade policy that is now facing a major upheaval."
“The Treasury market has sold off. It is focusing less on the dampening effect of this ruling on inflation expectations, not to mention making the Fed breathe a little easier, and more on the fiscal deficit implications now that this revenue source — as we now know, illegal all the while — now dries up to a large extent (and, it is uncertain how much that was drawn in will have to be repaid… and to whom)."
DEREK HOLT, VICE-PRESIDENT, SCOTIABANK ECONOMISTS
“We’re no in a more uncertain phase in terms of what lies next. What happens to potential refunds of IEEPA tariffs. How will this impact the Treasury. What other measures will be announced and when. Multiple sectors could be faced with elevated announcement risk until we find out what the administration plans to do next. ... All of this uncertainty is probably why the broad reaction across stocks and bonds was de minimis thus far.”
AVERY SHENFELD, CHIEF ECONOMIST, CIBC ECONOMICS:
“For Canada, this ruling doesn’t eliminate the most significant tariffs currently in pace, which are on autos, steel, aluminum, lumber and some copper products, which were imposed on other grounds (national security, or countervailing duties against purported subsidies). The vast majority of Canada’s other exports, particularly those with significant domestic content, are entering the US duty free by qualifying for the USMCA exemption from the 35% fentanyl tariff. But it does remove the threat of that 35% tariff being applied if the US opts to withdraw from the USMCA. The Trump administration could opt to test its powers to impose other tariffs, possibly by declaring a “balance of payments emergency” and invoking a 15% tariff that another obscure piece of legislation seems to allow, which perhaps not coincidentally matched the reciprocal tariffs on many countries that have been struck down today. That too, however, could be tested in the courts, and Congress would have to approve an extension of it after 150 days. Recent votes in Congress suggest that might not be possible. He could also seek to launch investigations of other imports and follow up with further national security tariffs or countervailing duties."
“So while this isn’t a cure for tariffs facing Canada in targeted sectors (and actually provides more immediate relief to Canada’s competitors in the US that face reciprocal tariffs on all of their exports) it is nevertheless an improvement in Canada’s negotiating position in the upcoming USMCA talks, by removing the leverage the US had with its threatened 35% fentanyl tariff.”
RICK MECKLER, PARTNER, CHERRY LANE INVESTMENTS, NEW VERNON, NEW JERSEY:
“While the initial reaction is up, the confusion it’s going to lead to is probably going to keep this market going back and forth over the next couple of days.”
“As far as investors were concerned, tariffs were never a good way to approach policy.”
“In the short term, winners would be the companies that are importing... from retailers to manufacturers who get their parts overseas. There is no shortage of companies that have been impacted by it or have mentioned that it’s a big factor in why they had to raise costs.”
PHIL BLANCATO, CHIEF MARKET STRATEGIST AT OSAIC, NEW JERSEY:
“This court issuance comes only two months before Trump meets with President Xi of China, where tariffs were anticipated to be Trump’s main card for negotiation.
“Immediately following the decision by the high court, equities jumped...Fixed income yields jumped over concerns that the U.S. Treasury is now going to have to pay a significant amount back to U.S. corporations. This would lead to a higher deficit and a potential degradation in credit standards of the United States.
“Lastly, the question of who has paid for the tariffs, U.S. companies, consumers, or foreign exporters, will come to the forefront on who deserves the repayment from the government.”
CHRIS BEAUCHAMP, CHIEF MARKET ANALYST AT IG GROUP, LONDON:
“It has good elements to it and slightly less good elements, because it will increase this legendary uncertainty that markets, of course, always fear.”
“You’re looking at, obviously, a whole host of industrial stocks, importers, consumer discretionary that’s going to be importing plenty of stuff from overseas. And that could mean that they will have some relief to bring down prices if and when—as I say, it’s an unclear situation—if and when the tariffs are firmly unwound and the order comes through.”
MICHAEL PEARCE, CHIEF US ECONOMIST AT OXFORD ECONOMICS:
“Even if the administration is able to replicate the overall level of tariffs using other means, the by-sector and by-country implications could end up looking very different, which will create another bout of trade policy uncertainty for business, investors, and households. This uncertainty is a key downside risk that could ding, rather than derail, growth this year.”
TOM GRAFF, CHIEF INVESTMENT OFFICER AT FACET IN PHOENIX, MARYLAND:
“The biggest uncertainty was whether the court would address refunds, which they did not. That is going to be the big next fight, with many companies already preparing for litigation.
“Longer-term, there will be two big questions: How does the government replace the tariff revenue? Without it, the deficit will be much higher than current, and this could create significant pressure on Treasury yields.”
ROB BURDETT, HEAD OF MULTI MANAGER, NEDGROUP INVESTMENTS, LONDON:
“This ruling has major implications for the limits of US presidential power and the division of power between the legislative branch and the executive branch, but also as a macro catalyst across equities, bonds, currencies and global trade flows. The Supreme Court’s decision on Trump’s tariffs is a major macro event with multi-asset ramifications.
“For equities, the ruling against the tariffs is widely expected to lift US and global equities. Relief from trade uncertainty may act as a tailwind for cyclicals and import-dependent sectors such as IT hardware (including semiconductors, although they will most likely be included in sectoral tariffs) retail and industrials.
“In terms of bonds, Treasury yields could rise (more so at the longer end) due to expectations of stronger trade activity and a potential widening of the fiscal deficit (if the historic refunds must be paid).
“The US dollar may soften if tariff refunds increase the deficit and reduce the policy-tightening impulse from higher import prices. Elsewhere, lower input costs ease pressure on margins, especially for retailers and manufacturers.”
GENNADIY GOLDBERG, HEAD OF US RATES STRATEGY, TD SECURITIES, NEW YORK:
“The big question for everyone is what exactly happens to refunds and whether this means the government has to refund the tariff revenue and how quickly that happens. And the key source of uncertainty is what the administration does in response.
“They have repeatedly promised that they will impose other tariffs with other statutes that will equilibrate the tariff rates. So I do think that will help limit the market’s response, because what matters for the fixed income market is forward collections of tariffs, even if there is a one-time refund that has to occur because of the decision.”
MARK HACKETT, CHIEF MARKET STRATEGIST, NATIONWIDE, PHILADELPHIA:
“The immediate algo-driven reaction will be in globally oriented companies that have the greatest tariff exposure, such as global markets, industrials, consumer staples, technology, and health care. Caution is warranted, however, as we have learned since the pandemic, as the initial, emotional reaction is often exaggerated and prone to whipsaws. The expectation of most investors is that the administration has an alternative strategy for tariffs.”
CHRISTOPHER HODGE, CHIEF US ECONOMIST, NATIXIS, NEW YORK:
“Despite this blow to his presidential powers, Trump still has plenty of tariffing tools in his arsenal, but we think, given the focus on affordability, he will be hesitant to use them. So while we cannot discount the possibility of renewed threats and continued drama in the trade realm, we think that we have seen the peak of effective tariff rates.”
TODD SCHOENBERGER, CHIEF INVESTMENT OFFICER, CROSSCHECK MANAGEMENT, WASHINGTON DC:
“The markets are responding because it’s a piece of uncertainty that is now certain. Markets are responding with a greater risk appetite for equities because we finally got something resolved and we’ve been in this back and forth pattern so far in 2026 and the main ingredient is uncertainty, so finally we have something that we can at least is done, let’s move forward.”
“I think this was the absolute expected outcome and Wall Street knew that was going to be the case the because there were hints that were being played out. The only question now becomes a rebate issue so that could have a negative impact on the economy.”
JEFF LESCHEN, MANAGING DIRECTOR, BRAMSHILL INVESTMENTS, NAPLES, FLORIDA:
“I think the Trump administration has contingency plans in place. Investors need to be a little more focused and take some time to digest the news. There’s a lot of information we don’t know at this point. I don’t think the ruling derails the trajectory of how things have been going. I don’t expect there will be major revisions to the S&P targets for the year.”
SCOTT LINCICOME, VICE PRESIDENT OF GENERAL ECONOMICS, CATO INSTITUTE, WASHINGTON:
“The court’s decision is welcome news for American importers, the United States economy, and the rule of law, but there’s much more work to be done. Most immediately, the federal government must refund the tens of billions of dollars in customs duties that it illegally collected from American companies pursuant to an “IEEPA tariff authority” it never actually had.
“Even without IEEPA, other U.S. laws and the Trump administration’s repeated promises all but ensure that much higher tariffs will remain the norm, damaging the economy and foreign relations in the process. Implementing new tariff protection will take a little longer than it did in 2025 and, perhaps, will be a little more predictable. Overall, however, the tariff beatings will continue until Congress reclaims some of its constitutional authority over U.S. trade policy and checks the administration’s worst tariff impulses.”
More to come