"The Oracle of Omaha" never claimed to have any oracular powers. I'm referring, of course, to Warren Buffett. The legendary investor wrote in a 2008 New York Times op-ed, "I can't predict the short-term movements of the stock market. I haven't the faintest idea as to whether stocks will be higher or lower a month or a year from now."
I agree with Buffett and his approach to investing. I don't know what the stock market will do over the next month or year. Don't look to me for any help with market timing. However, I do have an idea about what may happen this week. I predict the stock market will soar on Wednesday, Jan. 14, 2026 – but only if one specific thing happens.
Image source: Getty Images.
A monumental decision
Many observers expected the Supreme Court to hand down its decision on a challenge to President Trump's levying of global tariffs using the International Emergency Economic Powers Act (IEEPA) last week. That didn't happen. However, the nation's highest court will announce some rulings on Wednesday. The odds appear to be good that the tariff decision will be among them.
There are three key issues behind the challenges to the president's tariffs:
- The U.S. Constitution explicitly grants the authority to levy taxes (and tariffs are essentially taxes on imports) to the U.S. Congress.
- The IEEPA, on which the tariffs are based, doesn't even mention the word "tariffs."
- While Congress gave the executive branch some authority over international trade with the IEEPA, the president can only take actions in response to emergencies. Opponents contend that Trump's tariffs don't address emergencies.
Two lower federal courts have already ruled against the Trump administration. Online betting platform Polymarket shows a 72% that the Supreme Court will uphold those decisions.
Trump posted on Truth Social on Monday, "If the Supreme Court rules against the United States of America on this National Security bonanza, WE'RE SCREWED." Some, however, view the court's decision as crucial in upholding the separation of powers between U.S. government branches established by the country's founders.
Why the stock market could soar
I predict the stock market will soar on Wednesday if the Supreme Court announces that it's overturning the White House's tariffs based on the IEEPA. Why? Many investors would breathe a big sigh of relief if the tariffs were reversed.
Moody's Analytics (MCO 4.36%) chief economist Mark Zandi blames the stagnant job market in large part on the Trump administration's tariffs. He posted on X (formerly Twitter) on Jan. 11, 2026, "There has been no job growth (and likely job declines after all the revisions are in), as measured by either the payroll or household employment data, since Liberation Day last April, following the President's announcement of significant reciprocal tariffs."
Unemployment has indeed increased since earlier this year, as Zandi argues. He believes that "the fastest way to boost the job market would be for the Supreme Court to declare the reciprocal tariffs unlawful." Usually, what's good for the job market is also good for the stock market.
Which stocks could benefit the most from a Supreme Court decision overturning the tariffs? Potential examples include Mattel (MAT +0.68%) and Nike (NKE 2.82%), which import heavily from China, and UPS (UPS 2.93%), whose most profitable trading lane is between China and the U.S.
However, it's possible that stocks that don't have strong connections with imports could also jump. Lower tariffs could ease concerns about inflation and potentially give the Federal Reserve more flexibility to lower interest rates further, according to Clear Street analyst Owen Lau. Lower interest rates would help many companies.
A temporary boost?
Investors shouldn't get too excited about the prospects of the Supreme Court rolling back the reciprocal tariffs, though. Treasury Secretary Scott Bessent believes the Trump administration "can recreate the exact tariff structure" in jeopardy by basing tariffs on other federal regulations.
For example, Sections 301 and 302 of the Trade Act of 1974 allow the Office of the United States Trade Representative (USTR) to impose tariffs if an investigation determines that a country has implemented unfair trade policies that harm the U.S. However, there are some restrictions in the legislation that could hinder the Trump administration's ability to impose tariffs as easily and broadly as it would like.
It seems to be a pretty safe bet that more tariffs will be on the way to replace any tariffs nixed by the Supreme Court, assuming the court rules against the White House. If so, any post-ruling boost for the stock market is likely to be only temporary.
