Shares of Amazon.com Inc. advanced on Friday, closing the trading session with a notable gain as a landmark Supreme Court ruling on trade policy fueled a broader market rally. The e-commerce and cloud computing giant's stock price increased by 2.6%, settling at $210.11.
Supreme Court Overturns Tariffs, Sparking Market Rally
The catalyst for the late-session surge was a decision by the U.S. Supreme Court to invalidate sweeping global tariffs previously enacted by former President Donald Trump. The court determined the administration overstepped its authority under the International Emergency Economic Powers Act of 1977, a statute intended for national security crises. The ruling immediately lifted major market indexes and benefited companies with significant import exposure.
Financial analysts noted the positive implications for corporate profitability. "The decision might benefit corporate bottom lines, corporate earnings," observed Tim Ghriskey of Ingalls & Snyder. However, he and other experts cautioned that subsequent policy actions would be critical for determining the long-term market impact.
New Tariff Order Creates Immediate Uncertainty
Market optimism was quickly tempered as former President Trump responded to the ruling by issuing a new executive order. The order imposes a temporary 10% tariff on nearly all global imports, set to take effect next Tuesday for a duration of 150 days. The action utilizes Section 122 of the Trade Act of 1974. The order maintains existing exemptions for certain goods, including specific aerospace products and items from Mexico and Canada that comply with the USMCA trade agreement.
This rapid policy shift injects significant confusion into the market. Rick Meckler of Cherry Lane Investments highlighted that the situation "could rattle markets for a while." Amazon, which both manages its own vast inventory and provides a platform for millions of third-party sellers—many reliant on international supply chains—is particularly exposed to these trade policy fluctuations.
Economic Data Reveals Slowdown, Persistent Inflation
Investors also digested fresh economic data released on Friday. The Commerce Department's Bureau of Economic Analysis reported that U.S. Gross Domestic Product (GDP) growth slowed to an annualized rate of 1.4% in the fourth quarter, indicating a marked economic deceleration late last year.
Simultaneously, inflation metrics remained elevated. The Personal Consumption Expenditures (PCE) price index, the Federal Reserve's preferred inflation gauge, rose 0.4% in December and was 2.9% higher than the previous year. The core PCE figure, which excludes volatile food and energy prices, increased by 3.0% year-over-year, remaining above the Fed's target.
AWS Faces Scrutiny Over AI Tool Incident
Separately, Amazon's lucrative cloud division, Amazon Web Services (AWS), came under renewed scrutiny following reports of disruptions in December. A company spokesperson stated that an outage affecting internal artificial intelligence tools was "extremely limited," impacting only a single cost-management service within one AWS region in mainland China. The company attributed the incident to user error.
Any developments related to AWS reliability or spending plans are closely watched by investors, given the division's critical role in Amazon's profit engine. Earlier this month, Amazon confirmed a massive $200 billion capital expenditure forecast for 2026, earmarked largely for data centers and hardware to compete in the intensifying AI arms race among technology leaders.
Market Implications and Looking Ahead
The tariff ruling presents a complex financial picture. Analysts from the Penn-Wharton Budget Model estimate that potential refunds for previously collected tariffs could exceed $175 billion. However, the White House has signaled its intent to pursue alternative legal strategies to maintain pressure on trading partners.
The coming week promises several key events for markets. Tuesday marks the implementation date for the new 10% tariff, with traders keenly awaiting details on Customs procedures and potential refund mechanisms. Furthermore, earnings results from Nvidia on Wednesday, February 25, will serve as a crucial bellwether for AI infrastructure demand, a trend that significantly influences cloud providers and major tech stocks like Amazon.
