Supreme Court Nixes Trump Tariffs: What This Means for Stocks and Crypto

• Supreme Court declared the 2025 global tariffs illegal, opening a potential $150B‑plus refund pool.
• Equities surged; the S&P 500 and Nasdaq‑100 hit session highs within minutes.
• Bitcoin briefly reclaimed $68,000 but retreated, hinting at fleeting bullish sentiment.
• Major‑questions doctrine emerged as a new litmus test for future trade‑related executive actions.
• Investors must weigh short‑term rally versus longer‑term policy uncertainty.

You missed the fine print on the tariff ruling, and your portfolio paid the price.

Why the Supreme Court Ruling Reshapes Trade Policy

The Court’s 6‑3 decision hinged on the International Emergency Economic Powers Act (IEEPA), a statute originally designed for rapid responses to national security crises—not for broad, permanent trade barriers. By invoking the “major questions doctrine,” the majority signaled that any action with sweeping economic impact must have explicit congressional authorization. This creates a higher hurdle for future presidents who wish to impose unilateral tariffs, effectively returning trade‑policy power to Congress.

Impact of the Tariff Overturn on US Equities

Immediately after the opinion was released, the S&P 500 and Nasdaq‑100 vaulted to fresh intraday peaks. The rally was driven by two forces: first, the removal of a $150B‑plus over‑hang that had been factored into earnings forecasts; second, the market’s perception that inflation pressures from imported goods will ease. Sectors most exposed to imported inputs—technology hardware, automotive, and consumer discretionary—posted the strongest gains, with Apple and Tesla each climbing over 2%.

Historically, major trade‑policy shifts have produced similar spikes. In 2018, the announcement of a 25% tariff on steel sparked a short‑lived rally before the market adjusted to the higher cost environment. The current reversal, however, is unique because it removes a policy rather than adds one, delivering a net positive surprise that is likely to be more durable, provided Congress does not replace the tariffs with other protectionist measures.

Crypto’s Ripple Effect from the Tariff Decision

Digital assets reacted in a classic risk‑on fashion. Bitcoin jumped roughly 2% to retest the $68,000 level before slipping back to $67,000 as traders took profits. Ethereum and leading altcoins mirrored the modest upside but failed to break out of their short‑term ranges. The underlying narrative is clear: lower tariff risk reduces fears of imported‑inflation, which can bolster the U.S. dollar and, paradoxically, pressure risk‑off assets like crypto. Yet the crypto bounce was tentative, suggesting that the market views the ruling as a macro‑relief signal rather than a catalyst for a sustained bull market.

From a technical perspective, Bitcoin’s price action broke above its 20‑day exponential moving average (EMA) but remained below the 50‑day EMA, a classic sign of a “weak bullish” condition. Traders should watch for a decisive break above the 50‑day EMA as a confirmation of longer‑term upside.

Sector Trends and Competitor Reactions

Beyond the headline, the decision is reshaping competitive dynamics across several industries. Retail giants that had already sued for refunds—Costco, Walmart, and Target—are now poised to receive a share of the $130‑$175 billion pool. Their balance sheets could see a material boost, potentially translating into higher dividend yields or share buybacks.

Conversely, domestic manufacturers that benefited from the tariffs, such as certain steel and aluminum producers, may face renewed competitive pressure from cheaper imports. Companies like United States Steel and Alcoa have already signaled they will reassess capital‑expenditure plans, which could temper their stock performance despite the broader market rally.

Investor Playbook: Bull vs. Bear Cases

Bull Case: The refund pipeline injects up to $175 billion of cash into corporate treasuries, fueling buybacks, dividend hikes, and M&A activity. Equities in import‑heavy sectors should outpace the market, while crypto could benefit from a risk‑on environment if the macro backdrop stays benign.

Bear Case: Congressional backlash could introduce new, targeted tariffs or non‑tariff barriers, eroding the upside. Additionally, the logistics of processing refunds may take years, delaying any fiscal stimulus effect. Crypto may revert to risk‑off sentiment if volatility spikes around policy‑related news.

Strategically, investors might consider overweighting high‑margin import‑sensitive equities, trimming exposure to domestic producers that relied on tariff protection, and maintaining a modest allocation to crypto with tight risk controls. Monitoring upcoming Treasury guidance on refund mechanisms will be crucial for timing entry points.