SCOTUS Blocks Trump Tariffs, New 10% Global Levy Announced

The U.S. Supreme Court ruled 6–3 that President Donald Trump’s tariffs imposed under the International Emergency Economic Powers Act were illegal, striking down a core pillar of his trade agenda. The decision raises the possibility that the government could owe up to $175B in refunds to importers for previously collected duties, though the Court did not explicitly address repayment.

Within hours, Trump announced a new 10% “global tariff” under Section 122 of the Trade Act of 1974, which allows duties for up to 150 days without congressional approval. He also confirmed that tariffs under Sections 232 and 301 remain in effect and signaled new investigations that could lead to more permanent measures.

Economists estimate the invalidated tariffs represented roughly 60% of current duties, implying a temporary drop in the effective tariff rate before replacement actions.

Markets remained steady, with the S&P 500 rising 0.7% as investors anticipated alternative policy tools.

• Court invalidated major Trump tariffs

• New 10% global tariff announced under temporary authority

• Trade uncertainty persists despite policy pivot

FIG (+15.6%): Figma shares climbed after the company beat Q4 expectations and issued strong revenue guidance, reinforcing confidence in its durable growth and AI positioning despite broader software sector pressure.

ELF (+15.4%): e.l.f. Beauty after beating Q3 estimates and raising full-year guidance, boosting confidence in continued growth and triggering potential short covering.

COHR (+14.3%): Coherent climbed after investors continued to respond positively to its strong Q2 results, upbeat datacenter/AI optics outlook, and a wave of post-earnings analyst price target hikes.

CRWD (-9.6%): CrowdStrike fell after Anthropic introduced Claude Code Security, an AI tool that scans and patches software vulnerabilities, fueling concerns about rising AI-driven competition in cybersecurity.

CRWV** **(-7.1%): CoreWeave plunged after facing financing pressure where lenders declined to back a $4B data center project it anchors, reflecting growing concern over its below-investment-grade credit profile.

CPRT (-2.7%): Copart dropped after missing quarterly earnings and revenue estimates, reporting declining sales and margin compression that prompted analyst downgrades despite its strong cash position.

U.S. GDP expanded at a 1.4% annualized pace in Q4 2025, well below expectations, as a prolonged government shutdown weighed on activity. Federal spending plunged 16.6%, driving a 5.1% overall decline in government outlays, while consumer spending slowed to 2.4% from 3.5% in the prior quarter. Full-year growth came in at 2.2%, down from 2.8% in 2024.

Beneath the surface, demand held up better than the headline suggests. Final sales to private domestic purchasers rose 2.4%, and private investment increased 3.8%, indicating underlying resilience despite the temporary fiscal disruption.

Inflation showed little progress. Core PCE rose 3.0% year over year in December, with both headline and core prices up 0.4% for the month, keeping inflation above the Fed’s 2% target and reinforcing a cautious policy outlook.