Court of Appeal Backs Trump, Tariff Fears Return

The yen rose sharply, pulling Japan’s Nikkei lower as investors moved into safe-haven assets following a US court decision to reinstate Donald Trump's tariffs. US stocks rose on Thursday, with the Dow up over 0.25%, as markets initially rallied then gave up the gains as the court decisions were taken. High-level trade talks with Japan are due in Washington today, while a broader deal with China remains stalled.

Equities

The FTSE 100 fell 0.1% on Thursday, weighed down by losses in utility stocks despite news that a US federal court had temporarily blocked the implementation of President Donald Trump’s broad new tariffs. Utilities were the biggest drag, with National Grid falling 3.8% and Severn Trent dropping 2.3% as both traded without entitlement to their latest dividend payouts. The FTSE 250 rose 0.3%.

Auto Trader dropped 11.3% to a one-month low after missing annual revenue forecasts. Hollywood Bowl also fell sharply, down 10.3%, after reporting a 9.4% fall in half-year pretax profit to £28 million. Meanwhile, precious and industrial metal miners saw modest gains of nearly 1%, helped by stronger gold and base metal prices in London.

In the US, all three major indices closed higher, though well off their session highs. The S&P 500 rose 0.4% to 5,912.17, the Dow Jones added 0.3% to finish at 42,215.73, and the Nasdaq gained 0.4% to end at 19,175.87.

Gains were supported by Nvidia, which rose 3.2% after reporting strong quarterly sales driven by a surge in demand for AI chips ahead of new US export restrictions on China. The company warned that upcoming limits could reduce current-quarter revenue by $8 billion.

Boeing climbed 3.3% after CEO Kelly Ortberg said the company aims to increase monthly production of its 737 MAX jets to 42 in the coming months, with plans to ramp up to 47 per month in early 2026. The announcement came as investors look for signs of recovery in the aerospace sector.

Best Buy dropped 7.3% after lowering its full-year sales and profit guidance. The electronics retailer cited concerns over tariffs potentially dampening demand for expensive goods.

Salesforce slipped 3.3% even though it raised its annual revenue and profit forecasts, suggesting investors were looking for more decisive growth in the enterprise software sector.

Forex & Commodities

The US dollar edged higher on Friday but remained on course for a fifth straight monthly decline. The dollar index, which measures the greenback against a basket of six major currencies, was up 0.16% at 99.416 but still set for a 0.25% fall in May.

Traders continue to weigh the impact of reinstated US tariffs and uncertainty over fiscal policy. The pound was slightly firmer for the month, while the euro rose to $1.1378 ahead of German inflation figures. The Swiss franc stood little changed at 0.8225 per dollar, though it is also set to rise on the month.

The Japanese yen strengthened 0.3% to 143.80 per dollar after Tokyo’s core inflation reached a more than two-year high in May, adding pressure on the Bank of Japan to raise rates further. Despite the gain, the yen is on track to finish May lower against the dollar.

Investors are awaiting the Federal Reserve’s preferred inflation gauge, the personal consumption expenditures (PCE) report, due later Friday. Economists expect the April figure to show a 2.2% year-on-year rise, down slightly from 2.3% in March. Weekly US jobless claims came in above expectations, reinforcing concerns about a weakening labour market.

Gold rose 0.9% to $3,318.69 an ounce in spot markets, while US gold futures settled 0.6% higher at $3,343.90. The gains followed weaker US job data and market uncertainty around the legal status of Trump’s tariffs. Silver climbed 0.8% to $33.27, platinum added 0.2% to $1,076.90, and palladium rose 1.1% to $973.05.

Oil prices continued to slide. Brent crude fell 0.48% to $63.84 a barrel, and US WTI dropped 0.51% to $60.63. Both benchmarks are down 1.5% this week. Traders expect OPEC+ to announce another output hike at Saturday’s meeting, with analysts suggesting production could increase beyond the 411,000 barrels per day seen at the last two meetings.