A broad global rally in stocks that began in Asia on Thursday cooled as investors weighed uncertainty over the next steps after a U.S. court blocked many of President Donald Trump’s sweeping tariffs. By early afternoon trading in New York, the S&P 500 was up 0.3% after surrendering most of an earlier gain. The Dow Jones Industrial Average was higher by about 29 points, or 0.1%, and the Nasdaq composite gained roughly 0.5% as the market digested the ruling.
Markets initially reacted strongly in Asia, where Tokyo and Seoul opened to gains approaching 2% following a late Wednesday decision from the U.S. Court of International Trade. The court found that the 1977 International Emergency Economic Powers Act — the legal basis cited by the president for broad increases in import duties — does not authorize tariffs of the scope imposed. That legal finding eased some investor concerns that an unchecked tariff program could derail global trade and add to the inflationary pressures already burdening households.
While the ruling offered optimism that large-scale tariffs might be harder to impose, the White House filed notice of appeal, leaving the ultimate legal outcome unresolved. The decision applied only to certain tariffs and did not affect measures invoked under other statutes, such as those related to foreign steel, aluminum and autos. That partial scope and the path to appeal preserved a degree of uncertainty about trade policy and its potential economic impact.
“The decision raises the bar for imposing broad new tariffs,” said Brian Jacobsen, chief economist at Annex Wealth Management. Market participants interpreted the court action as a net positive because it reduced the immediate probability of an aggressive tariff escalation that could weigh on growth and consumer prices.
Those hopes helped push the S&P 500 back closer to its record territory; the index now sits within a few percentage points of its all-time high after falling about 20% below it earlier this month. Still, investors emphasized that longer-term policy risks remain, since the administration retains other tools to influence trade and tariffs.
Tech stocks lead, with Nvidia driving gains
On Wall Street, technology shares drove the advance after Nvidia once again exceeded analysts’ expectations for revenue and profit in its most recent quarter. Nvidia’s strong performance — a 3.8% intraday rise — was a key contributor to the S&P 500’s positive move, reflecting the company’s central role in the artificial intelligence hardware ecosystem.
Smaller AI-focused names also moved sharply. C3.ai, a provider of enterprise AI software, jumped more than 25% after reporting stronger-than-expected results and an increase in the potential value of a U.S. Air Force contract. E.l.f. Beauty surged after beating profit estimates and announcing a $1 billion acquisition of Rhode, the skincare brand founded by Hailey Bieber; the deal includes Bieber joining the company in a creative and advisory role.
Not all companies shared the upside. Best Buy fell nearly 9% despite reporting higher-than-expected profit, as the retailer missed revenue forecasts and trimmed its guidance for the full year. Management cited the continued uncertainty around tariffs and consumer behavior as factors complicating future outlooks — concerns echoed by multiple firms that have recently scaled back or withdrawn forward guidance.
Investors continue to separate companies that benefit from AI demand and strong margins from those more exposed to consumer spending patterns and trade-policy risk. The market’s internal leadership in this rally remains concentrated in technology and high-growth names.
Treasury yields retreat as economic data diverge
Bond markets softened alongside equities. The 10-year U.S. Treasury yield eased to around 4.43% from 4.47% late Wednesday, while the two-year yield — which more closely tracks expectations for Federal Reserve policy — dipped to roughly 3.95% from 3.96%. Mixed economic reports contributed to the move: revised data suggested the U.S. economy may have contracted less in the first quarter than earlier estimated, while weekly initial jobless claims incrementally exceeded economists’ forecasts.
International markets recorded notable gains. Japan’s Nikkei 225 climbed about 1.9%, leading Asian indexes higher, while Hong Kong and Shanghai each posted modest advances and South Korea’s Kospi rose after the Bank of Korea lowered its key interest rate to ease economic pressure. European markets were more subdued, with France’s CAC 40 slightly down and Germany’s DAX giving back earlier gains to end marginally lower.
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