Court ruling on tariffs could risks ’another 6 months of trade uncertainty’ for stock market

Investors in the Stock markets are weighing the implications of a U.S. Court of Appeals decision, announced on Friday afternoon, which could upend a key plank of President Donald Trump’s trade policy.

In a 7-4 ruling, the appeals court upheld a lower-court judgment striking down tariffs imposed under the International Emergency Economic Powers Act (IEEPA), dealing a blow to the legal foundation behind many of Trump’s levies.

Prominent market analyst, Vital Knowledge’s Adam Crisafulli, noted the outcome was widely expected given the skepticism voiced during oral arguments.

“The surprise isn’t that the Court of Appeals upheld the CIT, but that 4 judges dissented,” he wrote.

For now, there is no immediate effect: the court is holding its judgment until the Supreme Court decides whether to hear an appeal, with an Oct. 14 deadline for filings.

If the Supreme Court ultimately upholds the decision, much of Trump’s tariff architecture could be dismantled.

“Most of Trump’s tariffs (including all the reciprocal ones) were issued under IEEPA and so eliminating them would undoubtably be positive assuming the matter was then dropped,” he said.

Markets dislike tariffs because they squeeze corporate margins, raise costs for consumers, and complicate Fed policy. In a tariff-free environment, the Fed could more easily cut interest rates.