Washington — A US appeals court temporarily reinstated President Donald Trump's sweeping tariffs on Thursday, leaving Wall Street with no clear direction a day after most of the tariffs were blocked by a trade court, a move that had given markets a brief boost.
The order from the US Court of Appeals for the Federal Circuit in Washington provided no opinion or reasoning but directed the plaintiffs in the case to respond by June 5 and the administration by June 9.
Wednesday’s surprise ruling by the US Court of International Trade declaring the global levies to be illegal had threatened to kill or at least delay the imposition of Trump’s "liberation day" tariffs.
Chaotic US trade policy has sent global markets on a roller coaster in recent months. Equity markets were rattled by Trump's April 2 “liberation day” tariff announcements, which have since been repeatedly delayed and adjusted.
Following a market revolt after the April 2 tariff shock, Trump paused most import duties for 90 days and vowed to hammer out bilateral deals with trade partners.
Markets have swung wildly through Trump’s on-and-off tariff changes. The S&P 500 index is up 4.1% since duties were announced while European stocks have gained 2%.
Gold is up 5.9% from April 2, and the US dollar index is down 4.4%. Ten-year treasury yields have climbed 23 basis points to around 4.4%.
But US stocks showed little reaction to the appeals court decision, having already pulled back from the rally sparked by Wednesday’s trade court ruling.
Markets have grown accustomed to the president announcing steep tariffs only to postpone them soon afterwards.
“Trump has already rolled back most of these tariffs anyway, so these court rulings are just headlines,” said Adam Sarhan, CEO of 50 Park Investments in New York.
“As far as I’m concerned, as long as the market doesn’t tank on the news, it’s just a secondary byproduct,” Sarhan said.
The Dow Jones Industrial Average rose 117.03 points, or 0.28%, to 42,215.73, the S&P 500 gained 23.62 points, or 0.40%, to 5,912.17, and the Nasdaq Composite gained 74.93 points, or 0.40%, to 19,175.87.
At least two sets of scheduled trade talks appeared unaffected by the ruling. Japan’s trade negotiator is scheduled to meet US treasury secretary Scott Bessent in Washington on Friday for a fourth round of talks, while India still plans to send a trade team to Washington next week for talks, an India trade official told Reuters.
Earlier, White House trade adviser Peter Navarro, a staunch proponent of higher tariffs, told Bloomberg TV that the Trump administration could rely on other laws to implement import taxes should the court’s decision remains in place.
Trump had invoked the International Emergency Economic Powers Act (IEEPA), a law intended to address threats during national emergencies, to impose tariffs on almost every US trading partner, raising fears of a global recession.
The president temporarily suspended many of the tariffs until early July after markets swooned in response.
Trump’s trade war has shaken makers of everything from luxury handbags and sneakers to household appliances and cars as the price of raw materials has risen, supply chains have been disrupted and company strategies redrafted.
Drinks company Diageo and carmakers General Motors and Ford are among those that have abandoned forecasts for the year ahead.
Non-US companies including Honda, Campari and pharmaceutical companies Roche and Novartis have said they are considering moving operations or expanding their US presence to mitigate the impact of tariffs.
Update: May 29 2025
This story has been updated with the court decision.
Reuters
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