Market action in the wake of the tariff decision has been choppy.

There aren’t many tariff/Supreme Court experts on trading desks, so markets are understandably confused. Trump and other administration officials have said many times that they have other opportunities to reconstitute tariffs. The initial reaction in markets largely suggests they’re taking that at face value.

I’m not sure that’s the right take. The 6-3 decision wasn’t limited and it insists that Congress give clear authority on tariffs. Now Congress has done that with some authorities but those are time limited and/or require investigations. What’s clear is that he will no longer have the authority to wave his hand and put on tariffs and that limits his negotiating leverage.

We are waiting for the inevitable Truth Social post about tariffs and it’s taking a surprisingly long time. Now, we hear that Trump will hold a press conference at 12:45 pm ET — though I’d caution that he rarely starts on time.

My guess is that he could try to announce Section 122 tariffs immediately. That law authorizes the President to address “large and serious” balance-of-payments deficits by imposing broad 15% tariffs but they’re limited to 150 days and Congress is supposed to be consulted first. They could also be challenged by the courts but — critically — once the 150 days runs out, they’re done.

In the meantime, Trump can set off some other trade investigations that take in the neighbourhood of six months. However those statutes are around national security so they will be hard to justify on consumer goods. Are Nike shoe imports really a national security concern? The courts will insist that justifications are legitimate but that could also take some time.

So what you have is a market that’s bouncing around.

In all likelihood, the government will need to pay back $211 billion in IEEPA tariffs and that’s led to some pressure on bonds but only a couple basis points. Ultimately, that’s 4% of Federal spending.

The stock market likes it so far but there’s still skepticism. The S&P 500 is up 40 points, or 0.6% with the Nasdaq up close to 1%. In FX, the US dollar initially slid but it’s since bounced and the moves a modest.

My guess is that most investors want to take the weekend to research but this will ultimately be seen as very good news.