After the U.S. Supreme Court’s historic ruling striking down most of the tariffs signed by President Donald Trump.
After going 6-3, the S&P 500 rose 0.6% and the Nasdaq rose 1%. Global stock markets, including European stocks, South Korea and India, also rose.
The maximum benefit was for companies with high exposure to tariffs.
Amazon saw 2% because it sources 70% of its supplies from China. Shoe makers Deckers Outdoor, Birkenstock and Crocs rose more than 2%. Additionally, furniture retailers Wayfair and Floor & Decor saw a 4% gain.
Despite the positive growth, uncertainty remains. The court did not directly examine whether the companies can recoup billions in fares already paid.
According to Justice Brett Kavanaugh, the decision “says nothing about whether, and how, if so, the government should return the billions of dollars it has collected.”
With the reimbursements, there is also concern about a widening of the federal deficit.
Treasury yields have risen on concerns that the refunds will widen the federal deficit. The 10-year yield reached 4.096%, up 2 basis points. The dollar was slightly weaker.
The decision was made at a time when economic data was disappointing.
GDP in the fourth quarter grew at an annual rate of just 1.4%, below expectations and partly due to the government shutdown.
Core inflation remained at 3%, above the Fed’s 2% target.
