US Stocks Post Modest Gains Following Supreme Court Ruling on Tariffs
US stocks traded with modest gains in tentative trading on Friday, as reported by AP, after the Supreme Court struck down President Donald Trump's sweeping tariffs. This move had previously contributed to market volatility, and its reversal provided a slight lift to investor sentiment amid mixed economic signals.
Market Movements and Economic Data
The S&P 500 was up 0.1 per cent shortly after the ruling was announced, having earlier fluctuated between small gains and losses. This volatility followed discouraging economic reports indicating slower growth and higher inflation, which tempered market enthusiasm.
The Dow Jones Industrial Average added 20 points, or less than 0.1 per cent, while the Nasdaq Composite rose 0.1 per cent. Treasury yields remained largely unchanged in the bond market, reflecting a cautious stance among investors.
Earlier in the session, markets had drifted as investors reacted calmly to economic data that underscored the challenges facing the Federal Reserve. However, this data did little to alter expectations for interest-rate policy, with the S&P 500 later holding a 0.1 per cent gain after swinging between gains and losses.
As of 9:59 am Eastern time, the Dow slipped 19 points, or less than 0.1 per cent, while the Nasdaq Composite advanced 0.2 per cent. Treasury yields showed limited movement following reports that highlighted the difficult balancing act confronting the Fed as it navigates slowing economic growth alongside persistent inflation.
Economic Reports and Fed Policy
One report revealed that the US economy expanded at a 1.4 per cent annual rate toward the end of 2025, down from a 4.4 per cent surge during the summer. Brian Jacobsen, chief economic strategist at Annex Wealth Management, described this as "a bummer of a number," indicating disappointment in the growth slowdown.
A separate report indicated that the Federal Reserve's preferred inflation gauge accelerated to 2.9 per cent in December from 2.8 per cent in November. An underlying measure, seen by economists as a better predictor of inflation trends, rose to 3 per cent from 2.8 per cent, adding pressure on the central bank.
The Fed faces a difficult policy choice because it lacks tools to simultaneously address slowing growth and elevated inflation. It could lower interest rates to support the economy—as it did last year and as President Donald Trump has been urging—but doing so risks worsening inflation.
Fed officials stated at their most recent meeting that they want to see inflation decline further before supporting additional rate cuts. Following the data releases, traders continued to expect at least two rate cuts by the end of the year, according to CME Group data, though some shifted expectations for when easing could begin to slightly later in the summer.
The yield on the 10-year Treasury edged down to 4.07 per cent from 4.08 per cent late Thursday, while the two-year Treasury yield, which more closely tracks expectations for Fed policy, held steady at 3.47 per cent.
Individual Stock Performances
Among individual stocks, Akamai Technologies fell about 10 per cent, one of the market's sharpest declines. Despite reporting stronger-than-expected results for late 2025, its profit forecast for the upcoming year disappointed investors.
The company said it plans to spend a larger share of revenue on equipment and investments, highlighting rising computer memory costs linked to shortages created by the artificial intelligence boom.
Comfort Systems was among the gainers, rising 5.4 per cent after reporting stronger quarterly profits than analysts expected. Chief executive Brian Lane said the company is seeing "unprecedented demand," boosting investor confidence.
Overseas Market Activity
In overseas markets, European indexes posted modest gains following a mixed session in Asia. Hong Kong's Hang Seng fell 1.1 per cent after reopening following Lunar New Year holidays, while South Korea's Kospi jumped 2.3 per cent to a record high.
This surge was led by defence contractors such as Hanwha Aerospace amid increased global military spending, reflecting geopolitical tensions influencing market dynamics.
