
Market Surge as Court Blocks Trump's Tariffs: What You Need to Know
2025-05-29
Author: Li
Wave of Optimism After Court Ruling
In a stunning turn of events, Asian markets and Wall Street futures soared on Thursday after a US federal court put the brakes on President Donald Trump's controversial "Liberation Day" tariffs. This unexpected ruling has sent the dollar rising against safe-haven currencies, reigniting hopes of a more stable trading environment.
Court's Landmark Decision
The little-known Court of International Trade in Manhattan ruled that Trump exceeded his authority by imposing sweeping tariffs on imports effective April 2. This decision is a potential game-changer, indicating that the authority to enact tariffs fundamentally lies with Congress, not the executive branch.
Implications for the White House
Although the White House has quickly appealed the ruling and may take the fight to the Supreme Court, analysts believe this could be a pivotal moment that encourages Trump to retreat from imposing the steep tariff increases he previously threatened. Kyle Rodda, a senior financial analyst at Capital.com, highlighted that a court denial of these tariffs could significantly improve market risk appetites if the ruling holds.
Market Reactions and Global Impact
The market responded enthusiastically: Japan's Nikkei index jumped 1.7%, and South Korean shares climbed 1.8% to reach a nine-month peak. The MSCI index for Asia-Pacific stocks outside Japan rose 0.5%, while large Chinese companies gained 0.6%. The positive sentiment reverberated globally, with EUROSTOXX 50 futures up 1.3% and DAX futures following suit with a 1.1% increase.
NVIDIA's Stellar Earnings Boost
In tech news, strong earnings from chipmaker Nvidia, which exceeded sales projections and announced promising revenue forecasts, further propelled market confidence. Nvidia's stock jumped 4.4% in after-hours trading, overshadowing reports of US restrictions on semiconductor sales to China.
Safe Haven Currencies React
The court's ruling has also affected traditional safe haven currencies. The dollar rose 0.7% against the Swiss franc and the Japanese yen, while the euro dipped slightly to $1.1245. This shift indicates a market preference for riskier assets as fears around tariffs ease.
Interest Rates and Inflation Outlook
In related news, yields on 10-year US Treasuries rose, reflecting increasing confidence in the economic outlook. Market speculation around a Federal Reserve rate cut diminished, with July's likelihood dropping to just 22%.
Commodity Market Trends
In commodity markets, gold prices dipped 0.5%, while oil prices extended their rally, courtesy of OPEC+'s decision to maintain output levels amid geopolitical tensions concerning Venezuela.
Brent crude rose by 96 cents to settle at $65.87 per barrel, and US crude climbed $1 to reach $62.84 per barrel, indicating ongoing concerns over supply.
Conclusion: What Lies Ahead?
As the dust settles from this landmark court ruling, all eyes will be on the looming trade negotiations and whether the administration can find a way to navigate its tariff strategies without further destabilizing the markets. The future looks uncertain, but for now, optimism reigns.