US TARIFAS - INTERESTS AND THE CRITERIA OF THE Supreme Court: The Destination of S&P 500

Igor Pereira · Thursday at 18:50

Traders, the financial market today is squeezed between a temporary relief and a gigantic risk binary event.

On the one hand, the American real estate market begins to flash a distress signal disguised as relief. On the other hand, the US Supreme Court is about to turn the Russian roulette of tariffs, which can inject extreme volatility into the stock.

By Igor Pereira Financial Market Analyst

My direct reading of how these two forces are about to collide and impact your portfolio.

While retail headlines celebrate lower interest rates, professionals are assessing the reason for this rapid fall.

The Data: Mortgage rates for a fixed loan of 30 years fell to 6.01%]. This is the lowest level recorded since September 2022].
Trend: This represents a fall from the 6.09% observed last week, according to Freddie Mac data].
ExpertFX Reading: It is undeniable that this retreat can relieve the pressure of accessibility and help revive the housing market that was stagnant]. However, interest falling with this strength in credit means that gross money is running away from the risk and hiding in the security of Treasury Securities (falling the Yields). This is a thermometer of institutional fear, not economic strength.

As the credit market retreats, the stock market is on its toes awaiting a judicial decision.

The Imminent Risk: The US Supreme Court may decide later this week on the legality of the tariffs imposed by the government].
The Cash Flow: We are talking about a lot of money at stake; by January, the US had raised $124 billion in tariff rights].

JPMorgan's operating table traced the probabilities of the market outcomes and, surprisingly, the high road is almost blocked]:

Base scenario (64% chance): Current tariffs are dropped, but immediately replaced by new rules]. In this case, the S&P 500 would have a rapid speculative peak of 0.75% to 1%, but would return the gains quickly, closing with only high 0.1% to 0.2%].
Fall scenario (26% chance): Tariffs are maintained]. The S&P 500 would fall from 0.3% to 0.5%, accompanied by more aggressive movements in the interest curve).
High Minority Scenarios (10% chance): Only if tariffs are dropped after midterms (middle term elections) or without any replacement, we would see the S&P 500 shoot between +1.25% and +2%]. In both optimistic cases (9% and 1% chance, respectively), the Russell 2000 index would be the major performance highlight).

The stock market is priced for perfection, but Justice and the Government can deliver tax complexity rather than relief.

My Vision: Even if the Supreme Court lowers tariffs, the government can impose new taxes that would keep the effective rates very similar to those of 2025, which would put a brutal brake on the euphoria of the market].

Gold Protection (XAU/USD): All this legal insecurity and fiscal war on the dollar strengthens our primary thesis on metals.
Caution in Indexes: I do not advise opening large purchased positions (Long) in indices (S&P 500 or Russell) before the decision is read publicly. There's a 90% chance of price frustration.

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