E-commerce stocks hit by President Donald Trump’s far-reaching global tariffs rose on Friday, after the Supreme Court struck down a key plank of the president’s economic agenda.
In its 6-3 ruling, the court said Trump did not have the legal authority to impose tariffs under the International Economic Powers Act, which is how many tariffs have been imposed. IEEPA does not explicitly state definitions.
Send the decision AmazonThe company’s shares rose by more than 2%, while… Etsy rose 6%. shares Shopify, Wayfair and eBay More than 3% popped up. Pinduoduo Holdingsthe parent company of ultra-cheap online marketplace Temu, jumped 4%.
Trump’s sweeping tariffs have been largely devastating to e-commerce companies that provide a platform for online businesses to sell their goods.
In some cases, tariffs have eroded margins and forced companies to lay off employees, raise prices, or radically change their supply chains.
Trump also cited IEEPA when he announced the removal of the “de minimis” exemption, which allowed low-value packages to reach the United States without trade fees.
This has dealt a blow to many small business owners on Etsy, eBay, and Shopify who relied on the provision to support their businesses in the marketplace.
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It also threatened to break up Timo and Shane’s business in the United States
Deal retailers have used the loophole to ship packages to American shoppers directly from China duty-free. In response, Timo briefly halted direct shipments from China. The two companies have since built larger sales bases and logistics operations in the United States
The end of floors and other radical changes in tariff policies, combined with the bleak economic backdrop, also weighed on consumer sentiment.
Amazon CEO Andy Jassy told CNBC in an interview last month that Trump’s tariffs are starting to “creep” into the prices of some items.
The company has noticed that some people are trading in lower-priced items and looking for deals, while others are showing more hesitation about higher-priced discretionary items.
Etsy said in its annual report on Thursday that its business was under pressure due to declining discretionary spending and “evolving buyer behavior.”
“There is significant uncertainty regarding the evolving tariff landscape, how recent changes to minimum exemptions may play out, and the impact higher tariffs may have on consumer demand and discretionary share of wallet,” the company wrote in its 10-K filing.
The online marketplace, which hosts many small businesses and artisan makers, also provided tepid guidance for total merchandise sales in the first quarter. Etsy’s forecast assumes that macroeconomic conditions remain “stable compared to where they are at present,” CFO Lanny Baker said.
Representatives for Etsy and Amazon did not immediately respond to a request for comment on the SCOTUS ruling.
The National Retail Federation, a major trade group, said in a statement that the ruling provides “much-needed certainty for American businesses and manufacturers, enabling global supply chains to operate without ambiguity.”
Companies can now move to recover billions in tariff costs, with some already filing lawsuits ahead of the court’s decision.
apple It has paid about $3.3 billion in customs duties so far.
