A Main Street Alliance protester holds a sign in front of the U.S. Supreme Court as its justices will hear oral arguments on U.S. President Donald Trump's attempt to uphold sweeping tariffs after lower courts ruled that Trump overstepped his authority, in Washington, DC, USA, November 5, 2025.
Nathan Howard | Reuters
Traders have lowered the odds that the Supreme Court will uphold President Donald Trump's aggressive tariffs after justices on Wednesday raised doubts about the legality of the administration's sweeping trade powers.
At Kalshi, contracts contingent on whether the court would rule in favor of Trump's tariffs fell to around 30% from nearly 50% before Wednesday's hearing.
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A similar contract on the Polymarket platform fell to around 30% from over 40% earlier in the week, reflecting traders' growing belief that judges could overturn the policy.
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The moves came after several conservative justices joined their liberal colleagues in expressing discomfort with the sweeping authority Trump claimed under the International Emergency Economic Powers Act to impose tariffs on imports. They sharply questioned Attorney General D. John Sauer about the Trump administration's legal justification for tariffs, which critics say violates Congress' taxing power.
Lower federal courts have ruled that Trump does not have the legal authority to impose so-called reciprocal tariffs on imports from many U.S. trading partners, as well as fentanyl tariffs on products from Canada, China and Mexico.
Prediction markets, which allow traders to bet on real events, often react quickly to perceived signals during high-profile court hearings. Wednesday's shift suggested traders viewed the justices' tone as an indicator of headwinds for the president's trade agenda.
The Supreme Court will not make a decision in the case on Wednesday. It is not clear when the court will release its ruling.