welcome to Catalyst i'm Madison Mills 30 minutes into your US trading day let's get you the three catalysts we're watching this hour first up we break down the market action as stocks plunge amid Trump's sweeping tariff announcements we'll have full coverage for you ahead plus we look at what the market technicals signal about the next direction for stocks moving forward here and we're going to dig into the sector action as auto tariffs go into effect today and then we'll tell you which sectors are potentially going to be spared from levies we'll get you those details ahead half an hour into the start of US trading let's get a check of the markets here taking a look at the major averages you are seeing selling across the board here i want to take a look at your S&P 500 down a little over 3% but your tech heavy NASDAQ taking the majority of the hits this morning down over 4 and a.5% i do want to take a look at the bond market because we continue to see yields coming in this morning here and I'm checking to see we are nearing that 4% level on your 10-year if we do hit that 4% level that's going to be a critical level to watch this morning as we're continuing to see the bond market pricing in perhaps a growth slowdown risks of inflation a lot of potential concerns about the health of the economy as these tariffs are set to take effect so we're going to walk you through all the potential impacts for your portfolios we've got a great co-host to break it all down with us today today I want to bring in Brian Leva he's the global market strategist at Invesco with 20 years of experience in the industry he'll be here for the hour so Brian plenty to talk about this morning investors are are freaking out my DMs are flooded this morning with people who are stressed how concerned should people be in this moment i think we should still be concerned because there were two things we were hoping on liberation day that we would get some clarity around where this is ultimately heading and that rate and that the tariff rates may come in lower than uh had previously been expected so neither of those things happened look I never went to medical school i didn't take the hypocratic oath but I do believe the first rule of policym is do no harm and so we had a good setup for markets this year i think most outlooks were generally favorable a resilient economy and stable inflation and so markets were priced for that and and we're moving in the other direction right now i mean this is clearly going to slow growth the bond market is telling us that but the additional challenge is prices will rise so can the Federal Reserve respond to it markets are down a bit but perhaps not down enough to reflect the new growth and inflation dynamic that we're heading into yeah I'm curious about why we're not seeing even more selling this morning do you do you feel like the market is pricing in how risky this is about to be accurately well I think the market is still hopeful that this isn't the end right now we've got some pretty big moves like let's not forget we we had already um you know come off the highs pretty significant we've got some pretty big moves in markets but yes it's a market that still is waiting to see are these the negotiating points or is can tariff rates actually go higher from here could we have a tit to for tat reciprocal trade war um I mean that would be the that would be the bigger challenge right now i think the markets um selling off but not necessarily the full extent because waiting to see where we go from here at least not unless you're looking at small caps which have officially entered into a bare market and that's your I mean that's your growth proxy right if you're going to look um what is this inflationary is this a growth challenge how is the market viewing it i mean small caps are your growth proxy the 10-year Treasury is your growth proxy so it is a market telling you that growth in the United States is set to deteriorate pretty significantly all right Brian thank you so much we're going to have you with us for the rest of the hour to break down all the news our investors need to know here but as stocks are selling off we are also seeing the VIX the volatility index spiking currently above 27 and rising near the year-to- date high that we saw last month our next guest saying to expect continued and increased volatility to come here with us we've got Lizanne Saunders chief investment strategist over at Charles Schwab lzanne great to have you this morning what are you thinking where do we go from here so I I think what the market was pricing in with a 10% correction was maybe something around the base case and there have been a lot of best case base case worst case scenarios trotted out in the last several weeks and what we ultimately got was worse than the worst case and I I think there's many facets to it the the I think the lack yet of clarity on how does one negotiate this given the somewhat simplistic methodology around coming up with these uh tariffs rates we're we're everybody's trying to figure out all right so so what has to happen for those to come down and there's not much clarity on that i think another uh important facet to all of this that is less discussed as we look at what likely will be many firms and economists raising their probabilities of recession uh I think it's well better than an even odds at this point is the tentacles from the equity market to the economy we have household exposure to equities at an all-time high it's risen for every single income bracket and it makes me think of the 2001 era where we had an economic recession that probably wouldn't have been one were it not for the weakness in the equity market so I think we have to put an increased amount of weight on what the market does not just for things like will it trigger the Fed to do something but what are the actual implications for the economy and that's additive to the downside and also we are seeing that the US tenure is falling below 4% this morning for the first time since October just since we started asking you questions here Lzanne what is the bond market telling you about the health of our economy and about the amount of power that the Fed has to control this economy moving moving forward well in general when bond yields are keying off the growth trajectory and and prospects thereof and move down you tend to see a positive correlation with equities so lower bond yields lower stock prices when the bond market is keying off uh growth if the bond market were keying off inflation and we saw the move down without a commensurate hit to growth that would be a much different story for the equity market so I think the bond market continues to be in the driver's seat but that yield comparison to stocks as to whether it's inverse or positively correlated is a function of why yields are doing what they're doing and down on growth expectations deteriorating quite significantly negative for equities lzanne when you think about a higher probability of a recession what's your expectation for the equity markets is this you know a a garden variety mild cyclical recession where you may have to go down 20 25% like an early 1990s or do you think it's something that could be more ominous than that well there doesn't appear to be any significant dislocations within the financial system so that could be something that that that prevents this thing from getting much worse but if we were to see a significant tightening in financial conditions a blowout in credit spreads then you would you would call into question then the uh the health and stability of the financial system you know the the there's one pretty consistent determinant of whether a correction turns into a bare market or not and that is recessions corrections that have not been accompanied by a recession at some point in the not uh too distant future tend to just stay in correction territory those that morph into bare markets it's a function of recession or not so as you see recession probabilities go up uh you're probably going to see bare market probabilities go up and we're also seeing that traders are now fully pricing in a Fed rate cut in June previously that was July i wonder Lisanne how you are thinking about how these tariffs frame the market's reaction to economic data moving forward are we going to be back to bad economic news being good news because it gives the Fed an excuse to cut earlier uh I doubt it i I think and at some point you you get to that uh component or that piece in the cycle where easier monetary policy is sufficient to kind of write the economic ship but I I think it's premature to say that any kind of bad news particularly on the labor market front simply because it allows the Fed to ease i'm not sure you know a 25 basis point cut in the Fed funds rate um sort of cures the ills of what we're uh likely to see in terms of tariff related impact not to mention the Fed is still in a bit of a pickle because in an environment where the economy really deteriorates given tariffs you're probably not going to see that commensive deterioration on the inflation front which means they have to make decisions in the context of both sides of their mandate not sending the same message how do you think this ultimately settles if we're if the Federal Reserve can't do it with a 25 basis point cut will we have to see greater clarity on the trade side on the fiscal side i mean what are you looking for to to get a sense that we may be uh at extreme volatility or markets may be bottoming out i think it has to be more clarity or or just an improvement to the trade backdrop again I think just a simple shift in the monetary policy reaction function to being biased back in easing mode doesn't seem like that is going to cut it i think we also have to get through first quarter earnings season and reporting season because it it's I think it's a fairly easy guess that what companies are going to uh discuss on their conference calls is is any profit margin pressure they see and what is still a consensus expectation for double-digit earnings growth in 2025 albeit down from where we were at the beginning of the year is still predicated on very healthy profit margins and not much compression and I think that is a clear uh sort of forward-looking trajectory that's now being called into question so I think we would need to see some stabilization there and I think we're just at the beginning of the process of of any kind of rerating that's going to happen on the profit margin side to what extent does the Fed have the tools to combat any weakness like you mentioned obviously the wealth effect of the equity market selloff continuing here um but also any macroeconomic weakness does the Fed need fiscal policy to come in a little bit more in line in order to be able to help this economy i guess it depends on how you define fiscal policy one of the the frustrations in my mind to a lot of the shorthanding that's done with regard to headlines is that this will all be offset by upcoming tax cuts we have to remember that what's being discussed here for the most part is the extension of 2017's tax cuts not a whole bunch of new tax cuts other than on the margin on overtime and social security and tips but that's very different from the backdrop in 2017 when the administration offered the candy first and that candy was massive tax cuts which gave a boost to the economy got the spinach later via tariffs which were much narrower much smaller in scope and didn't have that retaliatory element to it now we're clearly getting the spinach this time and it's much more significant than what we saw it's not really candy other than thinking that if those tax cuts are not extended that would be a massive hit to the economy lozanne before we let you go this is one of those moments in markets where it's kind of breaking through the fourth wall and we're getting messages from friends and family who never watched the market and are freaking out about their 401ks this morning just want to get a chance to hear from you what is your message to those folks who are starting to panic about the health of their retirement accounts moving forward well well panic is not an investing strategy and and we always like to remind people of that so if the goal is to try to you know fully get out and then get back in at some future moment in time get in and get out are gambling on two moments in time that's not an investing strategy so all along investors should have been mindful of diversification across asset classes the fact that internationalists trounced US that was not a big story because everybody just assumed or a lot of investors assumed the US is the only game in town um the concentration risk that became really really prevalent given the dramatic outperformance of the magnificent 7 that has completely been turned on its head so that rebalancing discipline would have would have aided investors in this kind of backdrop and unfortunately you sometimes learn the hard way that those triedand-true disciplines around diversification across asset classes periodic rebalancing which is forces us to trim where there's been outsized gains um we sometimes learn the hard way that there's a big gap between what we think of as our financial risk tolerance kind of what's on paper and then our emotional risk tolerance lzanne really great response there thank you so much thanks for breaking all that down for us really appreciate it my pleasure thank you for having me we're going to have all your markets action ahead stick around for more you're watching Catalysts chip makers escaping specific tariffs as President Trump announces new levies on imports to the US still chip stocks getting dragged today along with the broader market joining us now Stacy Rasgen Bernstein's managing director and senior analyst stacy great to speak with you you say that semiconductors will still feel an indirect hit from these new tariffs how are you calculating the impact here what does that look like you bet so semis they will get hit by the baseline tariffs this 10% although I would say we don't import that many raw semiconductors anyways it was $82 billion worth of raw semis in 24 and not a lot from any single country i think Malaysia and Taiwan where they were most but even then was 16 billion from each a 10% increase semiconductor ASPs are up 50% over the last 5 years anyways that's okay the issue is the indirect that the products that the semiconductors go into are going to get hit by by tariffs and that that's the thing most semiconductors come into the US inside other things like PCs like smartphones and you can actually look like where is the US importing things like computer hardware and smartphones from and just to level set you in 2024 the US imported close to $200 billion of comput hardware servers PCs that sort of thing um about $114 billion of of of smartphones where and and if you sort of look at the locations and then the tariffs that are coming from those locations my math suggests something like a close to a 40% tariff on computing hardware and and and smartphones that the semiconductors are going into um cars as well we did $350 billion of vehicles and and and vehicle parts in 2024 those will get hit by a 25% tariff and so the issue really is not so much the directive that it's as these products now get more and more expensive is their demand destruction and for selling fewer of the products that the semis go into that that's the bigger bigger risk the other risk for semis just they're very cyclical and very global and they're very correlated to you know to to the macro to GDP so if this tips us into a recession that's probably not going to be great and so that I think is where the semiconductor stocks are actually moving rather than like worries about like the direct impact of the tariffs themselves yeah stacy which is worse for chip stocks a tip for tad on tariffs that allows for them to continue to get worse or a scenario where companies just sort of pause across the board on spending as they wait for those negotiations to unfold and hopefully get better well I mean I think those two things are coupled right they're not independent and and they're all and by the isn't just semis by the way i don't I don't think there's any sort of good news really for anybody out here so this isn't specifically a semiconductor related issue this isn't an everybody issue but yeah I mean if you're if you're worried about escalation both from other countries as well as from the US that becomes a problem um and I think the the point you make just about like paralysis Yeah is a very interesting one and and very true i mean like and this is part of the issue like how do you make plans that are going to going to take years potentially to put into place like if we want to bring facilities and infrastructure back to the US how do you make plans if you're not sure what like next week is going to bring on the stuff um or you know it you people people may even just wait if if you've got a project that's going to take like three four five years to bring to fruition anyways this administration will be out of power by then do you just decide to wait until the next one maybe everything come comes off um so that just the the general worry about decision paralysis I think is a big one and again for semis and and I think also like for for for broader for for the the broader industries as well stacy how should investors balance the concerns about near-term demand destruction with the prior excitement around the long-term structural theme of artificial intelligence yeah well I I think that theme is probably still real and still there again we'll see if if any of this stuff has any near-term implications for capex spending in that but I think AI is actually one of the themes that like through this probably can can work and frankly if we want higher productivity and everything else we we may need something something like that anyways um I think in the near term none of that is going to matter though like like I said this is this is going to overpower um near-term decisions like everything is going to get whacked multiples in general are going to come down like I mean just we're in an environment where you know uncertainty is going to be higher cost of capital is clearly going to be higher multiples are going to come down um and we'll have to see where where that bottoms i I think part of the other issues I I mean like on the surface like this it seems stupid and self-inflicted right and so you have to sort of wonder as to the mindset of the folks who are in charge who are like bringing a sledgehammer to this it it is going to make people concerned again broadly about like what sort of discount factor to put on on on those future cash flows and you know that's what we're seeing today like it's not like earnings and everything all get revised like necessarily today but like multiples are clearly going to come down and semis are going to get hit by that just like everybody else will well to that exact point Stacy Nvidia was cut to hold at HSBC this morning off the back of concerns that they have limited pricing power and that's going to be a hit to earnings where do you stand on that argument They have limited Well I'm not sure they have limited pricing power i'm not sure they have they have I mean they're running 75% margins and frankly people are lining up out the door to buy their products um uh they probably have more pricing power frankly than anybody else although I would say semiconductors in general do tend to have pricing power again you can look through co just because of the inflationary pressures um the average semiconductor ASP today versus say 2019 is up 50% so I think the industry and by the way people still bought semis i think the industry in general probably does have better pricing power than a lot of other industries like if I was selling t-shirts or shoes or something I would be more worried um about my ability to price the tariffs versus like semiconductors especially if it's like a 10% lift i'm not too worried about that um I think the broader disruption um and like I said the the the worry about demand disruption at the end unit um uh uh point is is I think bigger worries and I don't think those are those are isolated to Nvidia i think those are those are broad worries across the space i think I'm still sitting here with an iPhone 6 so I might be part of that problem what do you think what What's an expectation for what the damage may look like and how excited do you get around where valuations may be going on some of these great long-term theme names yeah i I to be honest I don't know like how how big the damage will be again if it was if it was a direct impact you you can size that we we've done that it's it's it's fine um the the indirect impacts in demand distor I I don't know because you need like you know data on price elasti elasticity for a gazillion types of end products like I I don't have that that data analysis I don't I don't know exactly how to size the general uh impact from this um it will again if this continues you know and the macro gets worse it'll probably be sizable like and again not not just semis again I don't I don't think this is isolated to semis but yeah you know the impact will will will probably uh will probably be be big So I I don't know how to size it though i wish I did stacy thank you so much love getting your thoughts really appreciate it brian I do want to go to you quickly on this how are you advising clients on the tech trade with so much volatility and uncertainty i think investors need to be concerned about names that are overvalued right and and so when you get in these types of environments I think a lot the hope had been that you get a broadening of a market the good way right a g synchronized global recovery and leading indicators and economic activity we're getting it the less good way which is investors are assessing where growth goes and bringing down multiples on stocks and so those that have been the highest priced you know what goes up tends to come down harder so I would say investors should focus on quality but focus on quality that is is has better valuations than what you see in the tech sector right now all right great overview Brian thank you so much you're going to stick with us here we'll have all your markets action ahead here on Yahoo Finance you're watching Catalysts we're about an hour into the trading day with stocks plunging as President Trump announces sweeping new tariffs julie Hyman is here now with a closer look at the market action hey Julie yeah this is not what you want to see on a day like this we opened lower and now we're going even lower from there now there's a lot of time left in the session obviously but nonetheless not a great sign here that we now see the Dow down 1500 points 3 and a.5% the S&P 500 similarly is now down nearly 4% and the Nasdaq is down 4.8% just looking at some of the other asset classes that we're watching here the Russell 2000 not in a bare market but it's actually heading towards one we're watching closer to uh actually we're getting pretty much there here a 20% drop from the high to the low we'll keep an eye on those numbers but we're uh I I think we might be there for the Russell 2000 and then elsewhere here today of course you would expect to see an uptick in volatility that is what we are seeing here to levels not seen since earlier this year with the VIX at above 27 and then we've been talking a lot about how there is not really any place to hide in the market here today that there is not any place where you're seeing positive returns one of the places we are seeing money go into is treasuries and with the price uh up we are seeing yields down this is a very large one-day move in treasuries of 18 basis points here and you see what yields have been doing all year long as we have talked about you know the Fed is in a little bit of a tricky situation here if tariffs are going to cause uh persistent price inflation then that potentially limits their ability to cut rates nonetheless that is what analysts uh and traders now seem to be expecting the dollar continues its slump as well again here's a year-to-ate chart and the leg lower that we are seeing today in the dollar is once again substantial crude oil is down sharply here today off by about uh 7% on the session below $67 a barrel as OPEC also announces output increases so bringing more supply to market in the face of the tariffs that's sort of a double whammy and if you think you can hide in gold think again because that is also down today digging into stocks a little bit uh we have seen a lot of the selling centered in large cap tech as of late but here today it's actually more broad-based while we've been see yes we see the NASDAQ leading in percentage terms but really you see a lot of other types of companies also declining meta it looks like and Apple are the worst two of the Magnificent 7 at the moment apple down 8% Meta down 7% and if we equal weight it here to see what's doing the worst it's actually not the pure tech stocks within the NASDAQ 100 you've got Lululemon that is falling sharply because it has it rejiggered its supply chains moved a lot of it to Southeast Asia well guess what southeast Asia is getting tariffed you've got Atlassian which is a software company trade desk Micron so kind of a split here dollar Tree though is on this list as well obviously they source a lot of their goods from outside of the country and then if you look at the Dow real quick as well and again I'm going to equal weight it so we can get a better look nike the worst performer there down by 13% right now maddie all right Julie thank you so much president Trump's 25% tariffs on cars imported to the US officially taking effect today automakers responding to the new levies volkswagen planning to add import fees to the sticker prices of its vehicles shipped into the US meanwhile Stalantis pausing production at some plants in Canada and Mexico and Ford benefiting from its larger than average inventory announcing discounts for customers joining us now to break it all down Diana Lee Constellation CEO diana great to speak with you just ran through a lot of the impact we're seeing on individual names which I know you follow very closely in your role talk to me about who is best positioned amid this moment so I think the most interesting part about all this is just because tariffs are actually announced as of today it's not like it's going to get affected immediately so what I mean by this is there's a lot of cars being imported right now into the US those vehicles were ordered over two three months ago by the distributors and the manufacturers so even though they're coming in it's not like those vehicles they can go back to the original distributors and say "Hey you're going to get a tariff today on those vehicles." So how the impact is really going to happen is truly 2 3 months from now because as those orders are happening as of today the tariffs will be actually be um a part of the pricing there are some manufacturers like Hyundai that said that they're going to actually eat the tariffs the most interesting part about this is even if they eat the tariffs offers are gone for new vehicles you can't eat the tariffs and actually have a 2.9 a 4.9 or incentives on these vehicles so if offers all go away the prices of every vehicle even if they eat the tariffs will still be higher so there won't be any incentives supply will also be a factor because people are trying to figure out where to actually distribute the vehicles to actually have lower tariffs but what people don't understand is based on the parts of every single car so even Tesla and Riven who actually make all their vehicles here in the United States will still have tariffs on the imported parts tesla has imported parts coming in from China they have gone to the US administration trade administration to ask for an exclusion yeah do you anticipate any of those exclusions any negotiations moving forward yes there's negotiations all happening in the background and the frightening part of this during the negotiations is some of the OEMs are basically saying they won't actually supply the US any vehicles now what happens then it then would mean that US would actually lose jobs because you wouldn't have jobs here in the United States with all these automakers actually whether they distribute in as they distribute into the US there's a lot of US citizens that work for many of the auto manufacturers so if they start laying off because of the fact that they can't distribute supply here then it will affect jobs in the United States so the expectation is the average life of a car on the road will just go up exactly so all new vehicles coming in in the next two months will start actually climbing and then the vehicles here will also be more expensive because right now we're at an all-time high of car sales because people know that tariffs are happening so March was an amazing month april will continue because all used vehicles people are going to try to get those vehicles and new vehicles that are currently on the ground will not have the tariffs and currently have incentives pulling forward that demand will the car will we wake up in a moment when the car companies will just not be offering some of the names that we're used to some of the models that we're used to exactly so what's going to end up happening is the cars that are more expensive to make because of the supply disruption they will not make those vehicles anymore those models will start going away and then the frightening part is some of the OEMs are basically saying they won't actually give any supply well if that happens we will go bankrupt here in the US for those automakers and all those jobs will be eliminated where for for consumers who are really concerned about the price hikes that are going to be happening here what is your advice to them is there any specific model out there that is most likely to have the smallest price increase yes so amusingly obviously it will be Tesla tesla will be the winner in all this and that's also scary to me because there's 25 traditional automakers that have all funded the US American economy and so from there because parts are also more expensive the consumers would actually have to pay for servicing of the vehicles at a higher rate as well so all anything to do with auto will end up going up hyundai has announced that they're actually advertising vehicles on Amazon but that's at MSRP and so as it's at MSRP there are no discounts discounts are going to disappear on vehicles right now because short on supply no offer and incentives it's exactly like COVID years coming back co no supply of new vehicles right no incentives on cars that's going to happen again i do want to ask too on a stock market level it's interesting we're seeing Goodyear ripping this morning the stock was up as much as 17% earlier now it's up about 10% and you can see that on your screen here with our Yahoo Finance platform and our tools there diana what does that move tell you about where there is opportunity for investors right now and then of course the end impact to consumers yeah so parts that are assembled here in this country will definitely be a winner as supply chains are all changing right now it may come out that there are announcements like Hyundai saying that they're going to put investments here in this country and start building plants and so there's going to be winners and losers based on who is actually producing all parts and all auto products here in the United States that's really what's happening and there's a lot of background conversation right now with President Trump in terms of negotiating future rates of actually producing things here in the country to avoid the tariffs right now diana thank you so much come back soon really appreciate your Absolutely thank you so much appreciate it one trending ticker we're watching today RH Restoration Hardware shares plunging by the most on record amid dual hits to the stock tariffs and disappointing earnings a tough day to have your earnings print on Liberation Day the luxury furniture retailer expecting a quote higher risk business environment this year due to the uncertainty caused by tariffs meanwhile the luxury home furnishing company's annual revenue growth forecast trailing Wall Street expectations fourth quarter sales and profit missing the average estimate analysts at city downgrading the stock to neutral amid the results and looming tariffs barlay's analysts adding there is quote significantly more uncertainty with the new round of tariffs adding risks to both sales and margin recovery rh which operates the restoration hardware chain sources about 70% of its products from Asia according to company filings vietnam and China account for more than half of that total on Wednesday Trump announced tariffs including 46% on Vietnam raising China's total levies to at least 54% on many goods the retailer conducted its earnings call shortly after Trump's tariff event again a tough time to have an earnings call that stock continuing to move to the downside coming up pharmaceuticals were granted a tariff exemption but we are diving into why drug makers they're not out of the woods yet stick around that's next we're going to produce the cars and ships chips airplanes minerals and medicines that we need right here in America the pharmaceutical companies are going to become roaring back they're coming roaring back they're all coming back to our country because if they don't they got a big tax to pay president Trump granting pharmaceuticals an exemption to his hefty reciprocal tariffs alongside semiconductors lumber copper and some minerals but the industry is already bracing for that to change with Denmark's benchmark index entering into a bare market amid concerns about Ozmpic maker Novo Nordisk and potentially some tit for tat there i want to bring in Steven Eel he is information technology and innovation foundation's VP for global innovation policy stephen great to have you here pharma somewhat safe for now where where is it heading in your view yes pharmaceuticals were exempted today however we have been continually led by the Trump administration to expect that the drug industry will see tariffs at some point in the future uh there is word out that the administration may open a section 232 investigation into pharmaceutical imports in the United States section 232 investigations are opened under national security grounds uh so while the industry is out of the woods for the moment we may see tariffs in the future it should also be noted as your viewers see today that while the pharmaceutical industry won't experience tariffs directly there is no industry business or citizens that will escape uh unscathed from these tariffs today uh in particular these tariffs are going to make drug innovation and drug manufacturing in the United States more expensive if you think about it to innovate drugs we have to have very sophisticated equipment like gene sequencers or scanning electron microscopes to manufacture drugs we have to have vacuum pumps and biosafety cabinets these inputs and components come from suppliers all over the world so even though the pharmaceutical product will be not exposed to the tariff all these inputs and components will and that's going to make US pharmaceutical manufacturing going forward less globally competitive when do you think the the US consumer will start to recognize I mean they're they're coming for our ompic and our Botox right and and um a significant amount of the generic drugs what's your expectation for when the Americans will when Americans could start to feel some pain well I think that as companies see that their cost of innovative innovation and manufacturing are going to rise in the future we'll ste see that starting to flow through uh into prices for a wide variety of products almost immediately and I would not expect this industry to be any exception and to that end what are you thinking in terms of the potential of retaliation with the likes of Novo Nordisk for example and how that could impact some of those prices for goods well the Trump administration in this case is like a chess player that only thinks on the offense uh and uh not looking at what the defensive what the retaliatory counter measures will be and one thing we have to recognize as well is that even though the Trump administration hasn't imposed tariffs on these pharmaceuticals as other countries look at the suite of tariffs they may put in place to retaliate against the US tariffs pharmaceuticals could very well be wet so this is going to harm American companies ability to sell their products into foreign markets going forward and uh I think if we you ask about you know Denmark in particular uh Nogor Nordisk um you know I think what we're seeing in these cases is u a recognition that uh you know the average American household is going to pay $3 to $5,000 more uh for goods by the end of this year as a result of these tariffs broadly and that is going to have an impact on all sorts of downstream or discretionary per purchasing the United States and this is why every industry uh including life sciences is seeing the hit from these tariffs today because uh the economies get a decrease uh it was pointed out that as a result of this Denmark may tip into recession but global GDP is expected to decrease by.5% this year including for the United States the chances of a recession in the United States are now at 35% uh so purchasing of all goods discretionary or not are going to decrease right and um uh something like Ozek which you you need but perhaps not as much as a you know a cancer treatment uh are going to be hit even more stephen great overview thank you so much appreciate it thank you coming up why top US executives are warning about major harm caused by the president's trade policy and what they're telling the White House as well that's next some breaking news crossing the wire here stalantis the maker of Ram trucks and Jeeps planning to temporarily lay off 900 workers at five US facilities after President Donald Trump's tariffs were announced now this comes as Stellantis is also the company is pausing production at two assembly plants in Canada and Mexico the company attempting to navigate President Donald Trump's new round of 25% automotive tariffs that took effect on Thursday the actions are the swiftest and most dramatic by automakers regarding these new tariffs which are imposed on all vehicles imported into the United States including from Canada and Mexico here just to run through a little bit more context here so we do know that Stalantis again the owner of Jeep and Ram brands the company saying on Thursday that they are pausing these additional plants at Canada and Mexico here moving forward the COO saying with the new automotive sector tariffs now in effect it'll take our collective resilience and discipline to push through this challenging time again those projected layoffs 900 workers that is expected to kick in on Monday and that is of course uh not the response perhaps that United Auto workers were anticipating when they came out in support of these tariffs you're now seeing the impact of profit margins kicking in at these companies and perhaps the sign of potentially more layoffs to come at these automakers well in a response to President Trump's broad tariffs business roundt CEO Joshua Bolton wrote "The tariffs quote run the risk of causing major harm to man American manufacturers workers families and exporters damage to the US economy will increase the longer the tariffs are in place and may be exacerbated by retaliatory measures according to a report from the Wall Street Journal corporate America is concerned about the president's trade policies for more I want to bring in Nick Timrose he's the Wall Street Journal's chief economics correspondent nick fantastic to talk with you this morning i know that you have been speaking with corporate executives you obviously cover the Fed very closely i just want to get a sense have you heard anything different from corporate executives since these tariffs were announced last night and what can you tell us well I you know if there's any good news it's that you now know you know what the So the cards are on the table and whatever uncertainty was there before obviously it hasn't gone away but you now kind of know what you're dealing with i think the problem is that nobody likes what they're dealing with here these are larger tariffs than what most people expected these are larger than what Trump himself had run on during the campaign you recall he had run on a 10% acrosstheboard tariff and 60% on China it seemed like China uh as was the case in the first term was going to be the focus of trade uh policy changes in the second term and so these tariffs announced yesterday Madison were just much larger uh than what uh people even at the more pessimistic end of things had been expecting nick where is the the voice of the business community in all of this i mean I remember during pre past presidential terms if there was something that the business community didn't like they were quite vocal about it or the Chamber of Commerce was quite vocal about it are you surprised that we're seeing it show up negatively in the survey data but we don't hear a louder voice from the business community well I think you look at some of the other things the administration is doing uh targeting universities that have uh taken positions that maybe the administration doesn't like going after some of these big law firms and so you you may see a culture of fear nobody wants to be the first to file the lawsuit challenging the constitutionality of these tariffs nobody wants to be the one to stick their head out and have it get cut off uh so I you know there there could be some of that here i think there's also been just let's let's see what this is before we uh you know go defcon five and and fighting it and you had a piece out this morning in the journal on how tariffs aim to create a new world economic order nick it's not just the US that is at risk of entering into a recession because of these tariffs what are your sources telling you about the risks globally for an economic slowdown well it's not it really isn't about sources at this point it's about what I mean you look at what what the markets are doing right now the administration has been saying short-term pain for long-term gain but the market doesn't see it that way the dollar is down bond yields are down stocks are down people are talking about higher inflation this year but with more rate cuts from the Fed uh later on to cushion the hit to growth i I think what you see here is Wall Street going through the five stages of grief uh you know we're we're clearly out of the denial stage now but whether we're in anger bargaining depression you know I I think it depends on your perspective which one you're in we're not at acceptance yet that's what we're seeing happen this morning in the markets so Nick really quick if we're going through those five stages of grief what does it take for the corporate executives who speak to you anonymously and say that they are fed up with these policies to be a little bit more vocal in order to get the president to pause on some of these policies i think that's a great question i I don't think we know what it's going to take um and it's it you know we're sort of in uncharted waters here yeah uh so we'll we'll just have to wait and see i I think that's the right question right now is where is you know people are asking where is the Fed put i think the question is where is the White House put at what pain point do members of Congress and businesses begin to put pressure on the White House to to uh you know to negotiate or do do whatever is going to happen here nick uh got to ask you about the Fed my favorite Fed correspondent we're hearing from Powell tomorrow how do you think he's going to respond to this and where do you think this puts the Fed moving forward well it puts the Fed in a very difficult position that you know that much is clear as to what Powell says um he's been very careful recently you know there isn't a big incentive for the Fed right now to be drawn into something that is the administration you know putting on these policy um actions that the markets don't like so the Fed at a certain point will have to react to uh weaker growth uh but if inflation's going up it gets awfully harder for them to do that one one other point I would make is that you know what what do rate cuts accomplish uh they help interest rate sensitive sectors of the economy like housing on autos but those also happen to be two of the most tradeaffected sectors so people here thinking that the Fed can run to the rescue uh I would sort of curb your enthusiasm about that if housing you know costs to build houses costs to put together cars are going up uh I don't know what interest rate cuts are going to do to cushion that hit a little bit hamstrung at least at the Federal Reserve level nick thank you so much really appreciate it and thanks to Brian Levit for sticking with me for the hour brian great to have you really appreciate it thursday's terueled selloff wiping billions off Wall Street's biggest names here with the biggest drops of the day host of Stocks and Translation Jared Blicky thank you let's start with Apple that just crossed $300 billion down and I'm looking at a tick a little bit lower here down 8.8% so here we have the S&P 500's uh biggest losers by market cap intraday here and I could give you some impressive stocks uh some impressive stats here but I'd also note that Apple is about 20% down from its high that's an important threshold we don't say individual stocks are in a bare market but that 20% level is catching a lot of eyes second up we have Amazon that's down 800 uh 880 181 billion not that bad nvidia down 180 billion meta down 120 and then it drops off from there but we're seeing a kind of a broad spatter smattering of different names here we got JP Morgan we have Exon Mobile so even the energy trade which has been uh kind of a bright spot this year against all of the turbulence even some of those big names are down chevron down 5% Caterpillar down 7% and I'll just give you a couple charts here and let's start with Apple and I'll go the last five years because not all of these stocks are approaching these levels from the same uh price point and here we have Apple in a recent high but you take a look at Nvidia the poster child of the AI trade this stock has been trading sideways for over a year so a lot of these names you can look at these charts and say tremendous amount of distribution here makes you wonder where the downside targets actually are back to you Maddie certainly does also the dollar now seeing the biggest oneday drop on record Jared coming up Wealth dedicated to all your personal finance needs