The market winners and losers if tariff ruling holds
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Illustration: Sarah Grillo/Axios. Photo: Brendan Smialowski/AFP via Getty Images
Most of President Trump's global tariffs were implemented illegally, a federal appeals court ruled.
Why it matters: The tariffs were poised to have a huge impact on the global economy. Here's what investors need to know about potential sector winners and losers in the stock market.
What they're saying: "The Federal Reserve's job just got a lot harder," Henrietta Treyz, director of economic policy at Veda Partners, tells Axios.
- "Investors shouldn't read much into the decision. Not only aren't we finished with this appeals process, but POTUS has other ways to impose tariffs," Terry Haines, founder of Pangaea Policy, texted to Axios.
Catch up quick: The ruling doesn't go into effect until Oct. 14.
- The ruling is expected to then put a pause on any major country-specific tariff (the ones that sank the market when announced in early April).
- Trump can still pursue sectoral tariffs, which could be his focus while this case is likely to head to the Supreme Court.
The market winners if this decision holds: Major retailers, ranging from Walmart to Home Depot to Nike, should all "go ballistic," Treyz says.
- On a macro scale, the biggest winners are Southeast Asian countries, she notes.
- "The transshipping industry is about to get a 60% margin plus up," she says, because several nations in the region were hit with both 20% IEEPA tariffs and 40% transshipping IEEPA tariffs.
- The elimination of the "de minimis" exemption will still apply.
The losers: Auto companies like Ford, General Motors and Autozone were tariffed under Section 232, which is not affected by the ruling.
- These firms are still expected to be subject to "more than a billion dollars worth of tariffs per year," Treyz says.
- Companies selling goods within sectors that could still be tariffed, including furniture, semiconductors, lumber, critical minerals, aircraft trucking and pharmaceutical goods, will "have no rest."
What we're watching: The bond market.
- Tariff revenue was "the only thing holding the bond market together," Treyz says.
- The Trump administration may now work to amp up sectoral tariffs so that revenues from levies can stay the same.
Thought bubble: Trading desks, financial advisers and sector analysts will be busy over this holiday weekend trying to figure out who survives this next round of chaos.
