US Stock Markets Rally Following Supreme Court Tariff Decision
US stock markets surged on Friday after the Supreme Court ruled that President Trump’s broad “Liberation Day” tariffs were unlawful. The court concluded that Trump exceeded his authority by using emergency powers to impose these tariffs, reversing key trade measures against several countries.
Major Indexes Post Gains
The S&P 500 rose 0.6%, while the Dow Jones Industrial Average gained 0.3%. Leading the rally, the tech-heavy Nasdaq Composite jumped nearly 1%. Stocks initially fell at the open as investors processed new economic data and monitored potential US-Iran tensions alongside private credit concerns.
Economic Data Impacts Market Sentiment
Friday’s market movement was influenced by US economic data. GDP growth for the fourth quarter came in at 1.4%, below expectations. Meanwhile, the “core” personal consumption expenditures index, which is the Federal Reserve’s preferred measure of inflation, rose more than anticipated in December on both a monthly and yearly basis.
Private Credit Sector Under Scrutiny
Investors are watching the private credit sector closely after Blue Owl halted withdrawals. Concerns have arisen that this could signal stress in the financial system, especially as some holdings involve AI-focused software stocks. Blue Owl’s shares continued to decline in premarket trading after selling $1.4 billion in private loans, including to its own insurer.
Market Outlook Amid Multiple Pressures
Despite the Supreme Court ruling boosting confidence, markets are balancing multiple pressures, including slower-than-expected GDP growth, rising inflation metrics, and potential volatility in private credit markets. Analysts suggest that while the ruling is a positive short-term catalyst, investors remain cautious about broader economic risks.
