^GSPC Today: February 24 — 10% Tariff Starts, Refund Risks
The Supreme Court tariff ruling now limits IEEPA use, so the White House starts a 10% levy under Section 122 today. That shift keeps policy fluid and raises refund disputes and retaliation risk. For UK investors, this matters for US equity exposure held in ISAs, SIPPs, and pension funds. The S&P 500 (^GSPC) sits near 6,874 as volatility edges up and import‑heavy sectors wobble. We outline what the Supreme Court tariff ruling means, how Section 122 tariffs work, and ways to manage risk from tariff refunds and policy moves.
What changed: from IEEPA to Section 122
The Supreme Court tariff ruling curbed reliance on IEEPA, pushing the administration to use Section 122 tariffs instead. Section 122 allows a broad, time‑bound levy, now set at 10% globally. This change narrows legal attack lines but does not end uncertainty over trade policy or future rate hikes. The move starts today, with details and exemptions still being assessed by markets source.
The White House signals a possible move to 15% if needed, keeping the path open while litigation evolves. The Supreme Court tariff ruling reduces one legal tool, but Section 122 tariffs remain flexible. Investors should expect periodic reviews, sector‑specific carve‑outs, and headline risk. Until the rate path settles, we see choppy trading, wider bid‑ask spreads, and sentiment swings across import‑reliant industries.
Market impact on ^GSPC and UK portfolios
^GSPC trades near 6,873.7, down 0.52% on the day, with a 6,815.43 to 6,884.68 range. Year‑to‑date change sits near -0.28% and the 52‑week range is 4,835.04 to 7,002.28. RSI is 44.81, MACD is negative, and ADX at 16.55 signals no clear trend. ATR at 80.58 points flags elevated swings, while Bollinger Bands span 6,797 to 7,020. We rate it C+ (Score 58.5), suggesting HOLD.
We expect the Supreme Court tariff ruling and Section 122 tariffs to pressure import‑heavy groups like retail, autos, machinery, electronics, and apparel. UK investors with US ETF allocations should watch currency effects and hedged versus unhedged share classes. Retaliation risk could hit UK suppliers tied to US demand. We prefer quality balance sheets, steady cash flow, and diversified revenue while index volatility stays elevated.
Tariff refunds and litigation risk
Refund litigation could reach about $175 billion collected under prior IEEPA actions, though outcomes and timelines remain uncertain. The Supreme Court tariff ruling may spur broader claims, yet Section 122 tariffs could continue alongside disputes. We see long legal arcs and uneven recovery odds, which markets typically discount unless success gains traction source.
Treat tariff refunds as upside optionality, not a base case. We would avoid concentrated bets on claim outcomes. Instead, keep balanced exposure across US domestic and exporter baskets, favour free‑cash‑flow leaders, and stagger entries. The Supreme Court tariff ruling keeps legal risk live, so we prioritise liquidity, position sizing, and stress‑testing scenarios for 10% to 15% rates and delayed resolution.
Scenario planning and watchlist
Our base case holds the 10% Trump 10% global tariff through the near term, with intermittent guidance updates. The Supreme Court tariff ruling limits IEEPA but leaves Section 122 intact, so volatility stays above average. Upside arrives if exemptions expand, refunds gain credible traction, or talks cool retaliation risk. Downside includes a lift to 15% or broader, faster‑than‑expected countermeasures.
Focus on customs implementation notices, White House review checkpoints, and initial refund filings. Track import cost pass‑through in retailer and auto guidance, and shipping lane updates. The Supreme Court tariff ruling will feature in early court calendars. For UK investors, monitor GBP/USD, sector earnings with US exposure, and fund factsheets for hedging and tracking error as Section 122 tariffs evolve.
Final Thoughts
The Supreme Court tariff ruling reshapes the legal playbook while Section 122 tariffs start at 10% and could rise to 15%. That mix keeps ^GSPC volatility elevated and muddies sector earnings visibility. We think investors in the UK should keep cash buffers, scale entries, and use staggered limit orders. Emphasise quality, pricing power, and diversified revenue to cushion import cost shocks. Monitor refund litigation as upside, not a plan. Our models show baseline targets near 7,066 over a year and 8,316 in three years, but policy remains the swing factor. Until the tariff path and any refunds become clearer, a cautious HOLD stance looks sensible.
FAQs
What does the Supreme Court tariff ruling change for markets?
It curbs IEEPA‑based tariff actions, pushing the White House to use Section 122 tariffs instead. That narrows legal grounds for some challenges but keeps policy flexible. Markets now price a 10% global levy and the risk of a 15% step‑up, with volatility higher across import‑exposed sectors.
How big could tariff refunds be and who benefits?
Estimates suggest up to about $175 billion in disputed IEEPA‑era collections. Outcomes are uncertain and may take years. If refunds occur, importers that paid duties could benefit. For investors, treat refunds as optional upside rather than a core thesis, and avoid concentrated legal‑outcome bets.
Which sectors face the most pressure under Section 122 tariffs?
Import‑heavy groups such as retail, autos, machinery, electronics, and apparel face tighter margins from higher landed costs. Companies with weak pricing power and thin cash buffers are most exposed. Firms with diversified supply chains, inventory flexibility, and hedging may cushion the impact better.
How should UK investors adjust exposure to US equities now?
Keep diversified US exposure but trim concentration in import‑reliant segments. Prefer resilient cash flow, low leverage, and strong pricing power. Consider partial currency hedging, use staggered buys, and maintain liquidity. Reassess holdings after policy updates, refund case milestones, or signs of retaliation that affect earnings visibility.
Disclaimer:
The content shared by Meyka AI PTY LTD is solely for research and informational purposes. Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.