Stocks rose on Friday after the Supreme Court ruled against President Donald Trump’s tariffs. This decision positively impacted retailers and other companies that faced increased costs last year due to these tariffs.
The Dow Jones Industrial Average increased by 170.51 points, or 0.3%, recovering from an earlier drop of 200 points caused by poor economic data. The S&P 500 also rose 0.3%, and the Nasdaq Composite climbed by 0.5%.
The Supreme Court’s ruling overturned most of Trump’s extensive tariff policy, stating that the International Emergency Economic Powers Act does not give the President the authority to impose such tariffs. However, the decision did not clarify whether tariffs already paid need to be refunded.
Following the ruling, shares of companies like Nike and Deckers Outdoors jumped by 2%. Other retailers, including Home Depot and Five Below, saw their stock prices rise, and Caterpillar recovered from earlier losses.
However, traders received disappointing news about the US economy. Gross domestic product (GDP) grew by only 1.4% in the fourth quarter, much lower than the expected 2.5%. The Commerce Department attributed this slowdown to a record government shutdown in the fourth quarter, which impacted growth.
Additionally, a report showed that inflation remained steady in December, with the core personal consumption expenditures price index at 3%, above the Federal Reserve’s target of 2%. The market overall faced pressure from alternative asset managers, particularly due to concerns over losses linked to private credit in the software sector.
As a result, the Dow is currently on track for a 0.1% gain, while the S&P 500 is up 0.7%. The Nasdaq is set to end its five-week losing streak, with an increase of more than 1%.
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