The Supreme Court Could Rule on Trump's Tariffs. Here's What Market Experts Expect.

• If IEEPA tariffs are struck down, importers of hard goods like Dick's Sporting Goods, Mattel, and Hasbro could see the steepest reduction in tariff expenses, while retailers like Walmart, Target, and Costco would see more muted reductions from the current estimated 20% incremental tariff burden.
• The court could issue a range of decisions beyond a simple yes or no, including narrowing tariff scope to specific countries, imposing time limits, or granting a grace period for the administration to change legal authorities underpinning the tariffs.
• Even with a full rollback, the Trump administration has alternative legal powers to reimpose or replace current tariff levels, making timing the largest unknown variable and suggesting total trade policy clarity may not arrive quickly.

Supreme Court Tariff Ruling: Market Impact Analysis

Key Development

The Supreme Court may rule as early as Friday on the legality of President Trump's tariffs imposed under the International Emergency Economic Powers Act (IEEPA). The decision could significantly impact markets and individual stocks, though multiple possible outcomes complicate trading strategies.

Financial Impact

According to the Tax Foundation, tariffs imposed last year cost U.S. households an average of $1,100, with estimates of $1,400 for this year. If IEEPA tariffs are struck down, these figures could drop to $300 (2025) and $400 (current year). Deutsche Bank estimates retailers are currently paying an incremental 20% in tariffs.

Companies Affected

High-impact importers (hard goods retailers): Dick's Sporting Goods (DKS), Mattel (MAT), Hasbro (HAS) could see the steepest tariff expense reductions.

Moderate-impact retailers: Walmart (WMT), Target (TGT), Costco (COST), and BJ's Wholesale Club (BJ) would experience more muted reductions, according to JPMorgan analysts.

Possible Outcomes

1. Full support for Trump's tariffs
2. Complete rollback deemed illegal (potentially with tariff rebates for companies)
3. Partial rollback narrowing scope to specific trade-deficit countries
4. Grace period allowing administration to change legal authorities with time limits

Market Implications

Navellier & Associates CIO Louis Navellier predicts "volatility if it's determined to be illegal, a rally if it comes in as allowed." However, Morgan Stanley notes the Trump administration has alternative powers to reimpose tariffs even if struck down, with timing remaining the "largest unknown."

The complexity of potential scenarios suggests market certainty may remain elusive despite an imminent ruling.