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Ruling against U.S. tariffs sends equities lower; gold hits record highs
U.S. stocks fell after a federal appeals court declared most of President Trump’s tariffs illegal, even as enforcement remains in place pending Supreme Court review. Elevated uncertainty lifted volatility and propelled gold to a fresh all-time high.
U.S. markets fell on uncertainty over the legitimacy of President Donald Trump’s tariffs.
The U.S. President will seek an expedited Supreme Court ruling to overturn the appeals court decision.
Gold set new record highs amid U.S. economic uncertainty; either outcome on tariffs risks instability.
ISM data signaled continued contraction in U.S. supply chains, marking a sixth straight sub-50 reading.
U.S. markets decline after appeals court ruling on tariffs
Major U.S. indexes fell an average of 0.67% as trading resumed following the Monday, September 1 holiday. An appeals court ruled that most of the broad tariffs imposed by President Donald Trump are illegal, though implementation is stayed until October 14, while the administration seeks Supreme Court review. The S&P 500 dropped by 0.69%, the Nasdaq by 0.79%, and the Dow by 0.55%. Rate-sensitive groups—real estate, technology, and financials—underperformed, while the Russell 2000 slipped just 0.01%. The VIX increased by 6.25% as the market closed in New York. Investors now look to Friday’s labor data, a key input ahead of the September 17 Fed´s meeting.
Trump to seek expedited Supreme Court decision
President Trump said he will request an accelerated ruling from the Supreme Court to overturn the appeals court’s decision, which held that the executive branch exceeded its authority and that tariff powers rest with Congress. With the stay in effect through October 14, current tariffs remain in place. The White House warned that removing them could harm financial stability. CNBC reports that Treasury Secretary Scott Bessent expressed his optimism that the Supreme Court will allow enforcement to continue and noted a contingency plan if tariffs are struck down.
Gold prices reach record levels as uncertainty over policy grows.
Gold surged 2.46% to a record $3,530/oz, extending its 34% YTD climb. Persistent demand from central banks, investor diversification, and safe-haven inflows are supporting prices. Policy outcomes around tariffs look destabilizing in either direction: continuation risks renewed supply-chain frictions and inflation, while elimination could dent Treasury revenues and widen an already large fiscal deficit. Against this backdrop, bullion’s appeal has strengthened.
ISM manufacturing contracts again
The ISM Manufacturing survey registered 48.7 for August assessment (prior 48.0), its sixth consecutive sub-50 reading. Company comments cited tariff-related cost pressures and supply-chain contraction amid softer government spending, according to Reuters. Seven industries reported growth, while ten reported contraction. The ongoing weakness in factory activity added to risk-off sentiment in equities and reinforced concerns that trade policy is weighing on industrial flow.
