Court Blocks Trump's Tariff Plans, Market Reacts Cautiously

A U.S. federal court's decision to block President Donald Trump's 'Liberation Day' tariffs prompted a brief market rally, which later waned as investors assessed the decision's implications and uncertainties. This ruling challenges Trump's authority to impose blanket tariffs, igniting discussions about potential changes in U.S. trade strategies.

The White House swiftly appealed the decision and hinted at the possibility of taking the case to the Supreme Court. This legal battle could stall trade negotiations while U.S. allies recalibrate their strategies. Goldman Sachs analysts noted that despite the ruling, Trump may still pursue other pathways to achieve his tariff goals.

Financial markets responded with initial enthusiasm, evidenced by the rise in S&P 500 and Nasdaq futures. However, as traders digested the ruling alongside less favorable U.S. job data, gains were pared back. In currency markets, the dollar's rally against safe-haven currencies faded, displaying the volatility sparked by ongoing trade uncertainties.

(With inputs from agencies.)