U.S. Stocks May See Initial Strength As Court Blocks Trump’s Tariffs
After ending yesterday’s choppy trading session mostly lower, stocks are likely to move back to the upside in early trading on Thursday. The major index futures are currently pointing to a higher open for the markets, with the S&P 500 futures up by 0.8 percent.
Early buying interest is likely to be generated in reaction to news that a federal court blocked President Donald Trump’s “reciprocal tariffs” on imports from U.S. trade partners from going into effect.
The Court Of International Trade ruled Trump overstepped his authority to impose the tariffs by invoking emergency economic powers.
“The Worldwide and Retaliatory Tariff Orders exceed any authority granted to the President by IEEPA to regulate importation by means of tariffs,” the three-judge panel wrote.
The judges also said tariffs on Canada, Mexico and China related to drug trafficking “fail because they do not deal with the threats set forth in those orders.”
The Trump administration immediately appealed the ruling, which could end up being decided by the U.S. Supreme Court.
A positive reaction to earnings news from Nvidia (NVDA) may also contribute to initial strength on Wall Street, with the AI darling surging by 5.3 percent in pre-market trading.
The jump by shares of Nvidia comes after the company reported fiscal first quarter results that exceeded analyst estimates on both the top and bottom lines.
After showing a lack of direction throughout much of the session, stocks moved to the downside in the latter part of the trading day on Wednesday.
The major averages all moved lower late in the day partly offsetting the strong gains posted in the previous session.
The Dow declined 244.95 points or 0.6 percent to 42,098.70, the Nasdaq fell 98.23 points or 0.5 percent to 19,100.94 and the S&P 500 slid 32.99 points or 0.6 percent to 5,888.55.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan’s Nikkei 225 Index surged by 1.9 percent, while China’s Shanghai Composite Index climbed by 0.7 percent.
The major European markets have also moved to the upside on the day. While the French CAC 40 Index is up by 0.5 percent, the German DAX Index and the U.K.’s FTSE 100 Index are both up by 0.1 percent.
In commodities trading, crude oil futures are inching up $0.10 to $61.94 a barrel after jumping $0.95 to $61.84 a barrel on Wednesday. Meanwhile, after slipping $5.50 to $3,294.90 an ounce in the previous session, gold futures are climbing $15.40 to $3,310.30 an ounce.
On the currency front, the U.S. dollar is trading at 144.55 yen versus the 144.84 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.1326 compared to yesterday’s $1.1292.
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