Global stocks gain on Supreme Court tariff verdict

Market Commentary

Wall Street settled higher on Friday after the Supreme Court overturned President Donald Trump’s reciprocal tariffs. The Court found the administration lacked authority under the International Emergency Economic Powers Act (IEEPA) to implement broad-based duties, though Trump swiftly responded with a new global tariff via executive order. Retail names such as Amazon and Home Depot moved higher as investors weighed potential refunds against the risk of fresh levies. Strength in the technology sector lifted the Nasdaq out of a multi-week losing streak, with Alphabet among the leading contributors. Core PCE inflation remained elevated, reinforcing the Federal Reserve’s cautious stance. In commodities, gold prices held firm amid policy uncertainty, while oil steadied despite ongoing Middle East tensions, supporting broader risk sentiment. Markets now face a renewed policy push-and-pull as the removal of earlier tariff uncertainty gives way to fresh protectionist measures from the White House.

European equities also advanced to record highs, supported by stronger-than-expected economic data and temporary trade relief. The Euro Stoxx 50 and broader Stoxx 600 posted solid gains following the Supreme Court’s tariff ruling. Although the White House signalled alternative measures, expectations of lower trade barriers improved the outlook for export-oriented sectors. Luxury stocks led the rally, with LVMH and Hermès among top performers, while banks such as Intesa Sanpaolo and ING rose on improved growth sentiment. European commodities mirrored global trends, with oil holding steady amid Middle East tensions and gold remaining elevated, supporting investor appetite for resource-linked equities. Upbeat February PMI readings indicated firmer business activity, and Air Liquide surged after reporting strong annual results.

Asian markets were mixed, shaped by global developments and lingering policy uncertainty. South Korea’s benchmark rose to fresh highs, while Hong Kong and Taiwan also advanced on optimism from the US Supreme Court ruling and potential reduced trade barriers. China’s exchanges were closed for the Lunar New Year, and Australia’s market drifted lower. Commodity-linked sectors provided some support, as oil remained steady amid geopolitical concerns and gold prices were buoyed by policy and trade uncertainties. Regional sentiment was tempered by AI-related risk aversion and broader geopolitical tensions, contributing to divergent equity and currency performance.

South African stocks ended firmer, led by gains in gold and diversified miners as bullion prices remained supported by global policy uncertainty and Middle East tensions. The FTSE/JSE Top 40 and All-Share indices rose, with Sibanye Stillwater and Gold Fields among the main contributors, while financials and industrials were broadly steady. The rand edged slightly firmer against the US dollar, benefiting from both higher commodity prices and external factors such as stronger-than-expected US inflation data, though broader dollar strength kept volatility elevated. The slight rand appreciation helped offset some imported cost pressures, even as traders remained focused on global monetary cues and geopolitical developments affecting risk assets.