A U.S. trade court issued an injunction early Thursday that prevents President Donald Trump’s recent “Liberation Day” tariffs from taking effect. The ruling follows multiple delays and adjustments to the tariff measures since their announcement nearly two months ago.
Administration Appeals, Markets Rally Briefly
The Trump administration immediately filed an appeal against the court’s decision. News of the injunction sparked a short-lived rally in stocks and lifted the dollar—one of the major casualties since the tariffs were first announced.
Companies Face Lingering Uncertainty
David Chao, global market strategist for Asia Pacific at Invesco, warned that ongoing uncertainty could harm corporate plans. He said companies may delay hiring, capital investments, and pay raises for factory workers. “That will curb earnings and reduce consumer spending,” Chao noted.
Tariff Suspension and Bilateral Talks
After the April 2 announcement triggered market instability, President Trump suspended most of the import duties for 90 days. He pledged to negotiate bilateral deals with trading partners. So far, only the agreement with Britain has been finalized.
Mixed Views on Sentiment and Growth
Charu Chanana, chief investment strategist at Saxo Bank in Singapore, called the court ruling “slightly positive” for market sentiment. She explained that it removes the worst-case outlook for U.S. growth. Yet she cautioned that the administration could still appeal or impose narrower tariffs, leaving businesses without a clear policy direction.
Market Moves Since Tariff Announcement
S&P 500: Up 3.8%
European Stocks: Up 2.2%
China’s Benchmark Index: Flat
Gold: Up over 4% in eight weeks
Dollar Index: Down 4%
10-Year Treasury Yield: Rose 30 basis points to ~4.5%
Asia’s major indices also climbed after the ruling, with South Korea’s Kospi and Japan’s Nikkei each up more than 7% since “Liberation Day.”
Risk of Reversal and Ongoing Caution
Sean Callow, senior analyst at ITC Markets in Sydney, urged caution. He noted that higher courts could overturn the injunction. “Markets must watch for a fuller judicial review,” Callow said.
Adapting to Volatile Policy
Ray Sharma-Ong of Aberdeen Investments described the current environment as driven by volatility and rapid policy reversals. He observed that investors are focusing on shorter-term trades tied to specific tariff developments.
Long-Term Impact on Business Decisions
Finally, Kei Okamura, portfolio manager at Neuberger Berman in Tokyo, warned that repeated policy changes will hurt long-term investment. He said CEOs may postpone major projects, and central banks will adopt an even more cautious stance. “This stop-and-go approach undermines the multi-year planning businesses require,” Okamura concluded.
