By THE ALASKA STORY
Feb. 20, 2026 – US stock markets moved higher Friday after the US Supreme Court struck down President Donald Trump’s sweeping global tariffs. It represents a major setback to a central pillar of his economic agenda. Rather than roiling investors, the high court’s 6–3 ruling was greeted with a burst of optimism on Wall Street, where stock prices have already reached record highs even with the tariffs in place.
The decision invalidates most of the tariffs the administration imposed under the International Emergency Economic Powers Act, finding that the 1977 law does not grant the president unilateral authority to levy broad, open-ended import duties on nearly every trading partner. The ruling affects tariffs applied to goods from China, Canada, Mexico, the European Union, and numerous other countries.
Markets reacted immediately.
The S&P 500 rose between 0.4% and 0.6% in early trading, with some updates showing gains approaching 0.7%. The Nasdaq Composite led the rally, climbing roughly 0.7% to 1%, while the Dow Jones Industrial Average posted more modest gains of about 0.2%, recovering from earlier weakness.
Investors appeared to welcome the removal of uncertainty surrounding higher import costs, potential inflationary pressure, and ongoing trade disruptions. Sectors particularly sensitive to tariffs, including technology, retail, and major importers such as Amazon, Home Depot, and Nike, outperformed the broader market. European markets and Asia-exposed stocks also advanced in response.
Chief Justice John Roberts authored the majority opinion, joined by Justices Amy Coney Barrett, Neil Gorsuch, and the court’s three liberal justices, a rare alignment in what is a largely conservative court.
“The President asserts the extraordinary power to unilaterally impose tariffs of unlimited amount, duration, and scope,” Roberts wrote in the deciding opinion. “In light of the breadth, history, and constitutional context of that asserted authority, he must identify clear congressional authorization to exercise it.” The court found that the 1977 statute cited by the administration “falls short” of the necessary congressional approval.
In his dissent, Justice Clarence Thomas wrote, “NEITHER the statutory text nor the Constitution provide a basis for ruling against the President.”
The ruling represents one of the most significant judicial checks on executive trade authority in decades and a notable rebuke from a conservative-led court.
Market analysts described Friday’s move as a “knee-jerk rally,” driven largely by relief. Investors had long worried that broad-based tariffs would push consumer prices higher, squeeze corporate margins, and escalate retaliatory trade actions.
Still, questions remain: Are the tariffs collected now subject to refunds? Stay tuned for updates.
One thought on “Stocks post ‘knee jerk’ rally as Supreme Court strikes down Trump tariffs in 6-3 decision”
Another example of America is a government being governed by two ruling governance systems:Democrat and Republicans. Do you think if the US Supreme Court was a tipped toward Democrat justices they’d rule not in favor of their president? If this subject was a Democrat topic, they’d stand in full support of tariffs. It’s why Republicans in Alaska need to stand together and Democrats stand together, so the people or voters Know exactly that Republican and Democrat are not just mearly groups but Government ideologies how one thinks which governance model the country should be governed under. In the halls of the capitals there should be no compromises but two bulls fighting and fighting for supermajorities to out vote the other. Too much compromising and the voters can’t tell the parties apart from one another.