The Supreme Court Takes on the Trump Tariffs 🏛️

Welcome back to the the Day Trading newsletter 📈 

If you feel like markets are moving in every direction at once right now, it’s because they are.

The Supreme Court dropped the most consequential trade ruling in decades on Friday, Trump fired back with new tariffs within hours, GDP came in way below expectations, cybersecurity stocks got demolished by AI fears, and Nvidia reports Wednesday.

Buckle up 👇️ 

📈 Less than 24 hours after announcing a new 10% across-the-board tariff under the untested Section 122 statute, Trump bumped it to the maximum 15%. The catch: Section 122 requires congressional approval after 150 days, and trade experts doubt the Republican Congress will extend it given polls showing Americans blame tariffs for rising prices (Reuters)

🔻 CrowdStrike plunged 11.3% Monday as Anthropic's new autonomous cybersecurity tool triggered a sector-wide selloff. Investors are now pricing in the risk that AI doesn't just help security companies — it replaces them. Palo Alto Networks and other names got caught in the downdraft (CNBC)

💰️ Nvidia heads into Wednesday's earnings carrying $50 billion in short interest — the largest notional short position in the entire S&P 500. Options are pricing a 4% post-earnings swing. Analysts expect $1.53 EPS on $65.7 billion in revenue, and the call will be the first since the $20 billion Groq acquisition (CNBC)

⏬ KKR and Blackstone dropped 9% and 7% respectively after activist hedge fund Saba Capital and Cox Capital Partners disclosed plans to tender for Blue Owl credit fund stakes at 20-35% discounts to NAV. Financials were the worst-performing S&P 500 sector Monday, down over 3% (CNBC)

🔼 Gold surged past $5,200 an ounce Monday as investors piled into safe havens. Tariff chaos, the GDP miss, and the broader risk-off mood pushed spot gold up ~2% to $5,208, with futures touching $5,225. Silver rallied sharply too (Yahoo Finance)

For the first time in modern history, the Supreme Court told a president he can't unilaterally impose tariffs under emergency economic powers. Friday's 6-3 ruling in Learning Resources, Inc. v. Trump found that the International Emergency Economic Powers Act (the law Trump used to justify his sweeping "reciprocal" tariffs) simply doesn't grant authority to levy import taxes. Chief Justice Roberts wrote that regulating commerce and imposing tariffs is Congress's job, not the president's.

The market reaction was swift but complicated. Stocks initially rallied on the ruling before reversing as Trump pivoted within hours to Section 122, an obscure and never-before-used trade statute that allows up to 15% tariffs without congressional approval (but only for 150 days). By Saturday, he'd maxed it out at 15%.

The 150-day clock is now ticking, and the real question is whether Congress extends them. Polls show growing opposition to tariffs as consumers feel the price impact, making extension far from guaranteed.

For investors, the takeaway is that trade policy just got a lot less predictable. The IEEPA route is dead, Section 122 has a hard expiration, and the administration is already signaling it will pursue product-specific and country-specific tariffs through other statutes. The era of sweeping executive tariffs may be over, but the era of tariff whack-a-mole is just beginning.

Markets hate uncertainty (and that's exactly what they're getting).

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⚠️ Disclaimer: Not financial advice. Do your research before making any trades.