TOP STORY
👨‍⚖️ Markets Jump 2% After Trump's Tariffs Ruled 'Illegal'

😅 Just when I think we’re done talking about Trump’s tariffs, some other major news happens that’s too important not to cover…

🧑‍⚖️ This week, to the markets’ surprise, a three-judge panel for the US Court of International Trade ruled Trump’s tariffs illegal, causing the markets to jump:

• The S&P 500 is up +2.2% this week, bringing us back in the green year-to-date (+0.74%)

• The Nasdaq-100 is up +2.6% this week, now at +1.7% year-to-date

🌮 And amid all the market whiplash, a new tariff-inspired investing strategy called the ‘TACO trade’ is making headlines.

🗞️ So before we talk about some of the other interesting news this week - from Salesforce ($CRM) falling 5% after earnings to Trump Media ($DJT) raising $2.5B to buy cryptocurrencies, let’s TACO-bout the tariffs and what the judge’s ruling might mean for the markets 😜

❌ Trump’s Emergency Tariffs Struck Down by Judge

🤔 So, how is it possible that a judge could even strike down the tariffs in the first place?

👀 Well, it’s actually not normal for the President to set blanket tariff policies the way Trump has been doing. Under Article I, Section 8, it's actually the US Congress that has the explicit power to “lay and collect Taxes, Duties, Imposts and Excises.”

🚨 The way Trump got around this was by invoking emergency law, saying that the nation’s “large and persistent” annual trade deficits were “an unusual and extraordinary threat” to national security and the economy.

👎 The judges disagree with Trump, saying his executive orders crossed the line and that “trade deficits aren’t an emergency.”

😬 What Does This Mean for the Stock Market? More Uncertainty…

📊 Now, whether you agree with the judges’ ruling or not, what does this mean for the stock market?

Well, with the federal appeals court temporarily reinstating most of the tariffs - there is little direct impact on tariffs for now, but the main result is really just more uncertainty, making it difficult for companies and investors to plan ahead, with Jonathan Gold, the VP of the US National Retail Federation, saying:

👊 The Trump administration has vowed to fight the ruling all the way to the Supreme Court and has stated that the ruling hasn’t interfered with the negotiations with key trading partners in the weeks ahead.

😰 While the markets are up this week, it’s unclear whether the judge’s ruling is actually good news.

📈 The markets have been soaring (up 19% now since the tariff crash) after Trump’s tariff pauses fueled hope that the US can strike trade deals before the pause is over, but as popular stock market commentator Jim Cramer puts it:

🤞 Fingers Crossed for a Quick Resolution

Uncertainty is bad for business, so the worst outcome for investors would be a long, drawn-out process in the courts.

For long-term ETF investors, this news probably shouldn’t change your strategy at all, but for folks holding stocks it’s worth keeping an eye on as the outcome could certaintly have a strong impact on company’s heavily exposed to the tariffs (i.e. Apple, which got pummeled last week after Trump threatened a 25% tariff on non-US made iPhones)

Alright, enough tariff-talk for now - let’s switch gears to some of the other big news this week. But first, a quick word from today’s sponsor State Street Global Advisors!

PRESENTED BY STATE STREET
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^{*See Important Risk Information at the end of the newsletter!}

ALSO IN THE NEWS
🗞️ Other Key Headlines this Week

📉 Salesforce Drops 5% Despite ‘Not Bad’ Earnings

• Salesforce ($CRM) announced earnings on Wednesday, with Q1 revenue of $9.83 billion and earnings per share of $2.58, beating analyst expectations.

• Despite this, the stock fell -5% and is now down -20% year-to-date amid fears that “growth is not going to accelerate” and that “growth is uninspiring” with some analysts downgrading the stock.

• This comes right after Salesforce disclosed its $8B acquisition of Informatica, in a major move to strengthen its AI and data infrastructure capabilities.

• Amid the drop, some analysts beleive the stock is undervalued, pointing out its 7.1x price-to-sales ratio and 27x price-to-earnings ratio.

• On Blossom, buying outweighed selling with 140 members buying the stock this week compared to only 49 selling.

🏪 Meta Planning to Open Physical Stores to Showcase Quest VR and Smart Glasses

• Based on a leaked internal memo, Meta ($META) is exploring a global rollout of physical retail stores to promote its growing line of hardware, including Quest VR headsets and Ray-Ban smart glasses.

• Meta’s smart glasses sold 1 million units last year, which Mark Zuckerberg says is a "great start" but is "not going to move the needle and the business in a core way."

• Despite this, Meta plans to launch a half-dozen more AI wearables as Google launches its own smart glasses, and Open AI is expected to make its own entry into the market after acquiring former Apple design chief Jony Ive's startup to build “a new type of device for the AI era.”

🤑 Trump Media Falls 12% After Plans to Spend $2.5B on Cryptocurrencies

• Trump Media & Technology Group (DJT) confirmed it plans to sell $1.5B in stock and issue $1B in convertible notes to purchase bitcoin in “one of the largest bitcoin treasury deals of any public company.”

• The move mirrors MicroStrategy’s ($MSTR) approach, but DJT’s fundamentals remain weak: Q1 revenue was under $1M with a $31.7M net loss (which is insanely low for a company valued at nearly $5B).

• The stock dropped 12% following the announcement, as investors reacted to the dilution and questioned the strategy's viability.

🌮 The ‘TACO’ Trade Makes Headlines As Investors Make the Bet that ‘Trump Always Chickens Out’

• The “TACO” trade, short for “Trump Always Chickens Out”, has made headlines as an investing strategy based on President Trump's pattern of announcing steep tariffs and then delaying or reversing them following market backlash.

• The term gained prominence after Trump proposed a 50% tariff on European Union goods, causing markets to drop, only to postpone the tariffs days later, leading to a 741-point rebound in the Dow Jones Industrial Average.

• President Trump has dismissed the “TACO” label, calling it a “nasty question” when asked by reporters.

🍁 Canadian Banks Report Earnings, Raising Dividends and Reporting Growth

• TD Bank (TD) beat expectations with $4B in profit and a 2% dividend hike, helped by stronger capital markets and lower loan-loss provisions.

• RBC (RY) reported $3.95B in net income, up 7% year-over-year, driven by higher interest income and strong performance in wealth management.

• Scotiabank (BNS) posted $2.22B in earnings, up 4%, and raised its dividend by 3%, supported by growth in international banking.

• All three banks flagged higher expenses tied to technology investments and regulatory compliance, but stable credit conditions and dividend hikes show the banks are weathering the trade war so far

• ZEB, the Equal Weight Bank Index ETF, is up +7.6% this month and +22% over the past year.

COOL NEW TOOL
📊 Public Launches Generated Assets

🎁 As many of you know, we have a cool partnership with Public.com where if you create a Public account and link it to Blossom you get 1-year of Blossom PRO for free!

⭐️ Well, in addition to all their other powerful features (like 6.9% locked-in yield), Public just launched a pretty crazy new AI feature where you can essentially create your own ETF based on a prompt. I tried asking it for an ETF that would benefit from the ‘TACO trade’ strategy and here’s what it gave me!

😎 It’s pretty fun to play around with, and I think on Public you can even directly buy your new ETF directly if you have an account (which you can create here with the Blossom link). Pretty cool new innovation in the investing space, haven’t seen anything like it before!

FROM THE BLOSSOM COMMUNITY
⭐️ Featured Discussions this Week

👇 Click to see the full post! Unfortunately the links are broken right now for the web app so they’ll only work on mobile 😢