The Rundown - Trump Lays Down the Tariff Hammer, Layoffs Spike in March Due to DOGE

Episode Date: April 3, 2025

Stock market update for April 3, 2025.

Public.com presents the rundown. Your daily market update in five minutes. My name is Zaid Admani, and today is Thursday, April 3rd. In today's episode, we dive into Trump's new tariffs and why the markets are freaking out. We highlight some of the biggest losers from these tariffs like Nike, Lulu Lemon, and Apple, and why no country is being spared, even those only inhabited by penguins. We've got a great show for you today. Let's go

Well, the stock market on Wednesday was feeling surprisingly optimistic with the S&P 500 gaining 0.7% And the NASDAQ added 0.9%. While that optimism didn't last long after the markets closed and President Trump started his Liberation Day press conference. In that press conference, Trump showed off his latest tariff plans, which includes slapping much higher reciprocal tariffs than what the markets were expecting. In fact, Wed Bush analyst Dan Ives said that these tariffs were even worse than their worst-case scenarios. We'll get into the details of these tariff numbers in just a bit. But this tariff announcement has caught investors off guard leading to a global market sell-off. Stocks in China, Japan, Europe, and the UK all drop between 2 to 3%.

And even stocks here in the U.S., I'm recording this right around the market open. They are deep into the red. So the markets were clearly not expecting this, and investors are full. freaking out right now. So let's get into the details of Trump's new tariff plan. Trump's tariff plan that he announced yesterday at the Rose Garden has two parts. The first part is a 10% baseline tariff on all imports to the U.S. Now on top of that, many countries are getting hit with a specific reciprocal tariff. You know, during the press conference, Trump held up a large poster-looking thing. It had a list of a ton of countries and the tariffs

that those countries will be charged. And the rates being charged are way higher than anybody had anticipated. China is getting hit with a 34% tariff. The European Union, which is a major trade partner with the U.S. is being slat with a 20% tariff. Vietnam is getting hit with a 46% tariff. Taiwan at 32%. Japan at 24%. India at 26%. Now, I'm not going to read the whole list, but I mean, these percentages are insane. The Trump administration said they came up with these percentages by figuring out how much these countries are charging the U.S. Now, there's already been some criticism about their calculation method. We'll probably have to cover that on a later episode.

But the big takeaway here is that these reciprocal percentages are way higher than what anyone was expecting. Oh, and I should mention, these reciprocal tariffs are on top of any existing tariffs on that country. So for example, Trump already put a 20% tariff on China earlier this year. So these 34% tariffs are going to go on top of that, which means that Chinese imports starting on April 5th will be subject to a 54% tariff. This is absolutely brutal.

Tariffs on India and Vietnam are also very notable because many companies move their manufacturing from China to countries like Vietnam and India in order to avoid tariffs on Chinese imports that went into effect during Trump's first term. According to Bank of America, since 2010, the percentage of apparel imports to the U.S. from China has almost been cut in half to 21%, while that figure from Vietnam has more than doubled to 19%. So this is going to be a huge gut punch to the companies that move their manufacturing to India and Vietnam. And not to mention Trump is also moving forward with tariffs on specific industries.

Like starting today, 25% tariffs on autos is going into effect. So all of this just caught the markets off guard, which is why we're seeing a deep sell-off all over the world. There are some people on Wall Street that are sounding the alarms saying this is going to lead to higher inflation and slower growth, potentially a stackflation crisis. Now, I guess there was some silver lining to the announcement yesterday. Canada and Mexico weren't on the list of countries being hit with reciprocal tariffs. That's why car companies like Ford and GM aren't being hit as hard today. The White House also said there will be exceptions for semiconductors, pharmaceuticals, gold, copper, and lumber. But overall, I mean, this new tariff policy is totally shocking. And there's still uncertainty

and confusion on how long these tariffs will stay into effect. I'll be honest with you guys, I'm still shocked in processing all of this. And it seems like the markets are as well. Shifting gears a bit, the tariff news wasn't bad enough. The labor market is also showing signs of volatility as well. There was new data showing that layoff announcements in March surged to the most since the pandemic. Furloughs at the federal government totaled 216,000. In total, there was over a 275,000 reduction overall in the labor force.

That's the third highest monthly total ever, topped only by April and May of 2020, where employers laid off a combined 1 million, workers due to the pandemic. Now, according to the firm behind the support, Challenger Gray and Christmas, they say that Doe, the Department of Government Efficiency, has been the dominant reason for job cuts this year. They say that government layoffs are up 672% year to date compared to last year, and that

Doge is responsible for 280,000 firings of federal workers. I guess we'll see if a lot of these jobs get absorbed by the private sector or if it's going to lead to a meaningful rise in unemployment. There's a lot of things in flux right now. Let's talk about some stocks making moves today. There's not a lot of green on the board right now, but chairs of Lamb-Watson are up this morning after the potato company beat earnings and revenue estimates for the quarter. Lamb-Wetton supplies French fries to major fast food chains, think McDonald's and Wendy's.

On top of their earnings beat, Lam-Wetzen also reiterated their outlook for 2025. I guess it's a good thing that potatoes are made in America, so the company's business doesn't seem to be at risk of all the mayhem from Trump's new reciprocal tariffs. Shares of Lamwetson are up more than 6% today on this news. Now, there are a ton of losers in the stock market today. Apparel companies, especially Nike and Lulu Lemon, their shares are getting hit the hardest because of Trump's reciprocal tariffs on major manufacturing countries such as Vietnam,

which was hit with a 46% tax on imports to the U.S. Nike manufactures around half of its shoe supplies in Vietnam, and Lulu Lemon gets about 40% of its products from Vietnam. shares of Nike and Lulu Lemon are down around 13% this morning. Another big loser this morning is Apple. Like I mentioned earlier, tariffs on Chinese imports will rise from 20% all the way to 54% because of these reciprocal tariffs. And Apple makes 90% of its iPhones in China.

So that's not looking good for the tech giant. Morgan Stanley estimates tariffs on China will increase Apple's annual costs by $8.5 billion, which would be a 7% hit on the company's profits next year. And that's why Apple stock is down nearly 8% today. Let's wrap the show with the fun fact. These new tariffs by Trump didn't spare anyone on earth. Even small territories and remote islands are being hit. Like take for example the Australian territory Norfolk Island,

which is home to just 2,200 people and exported just $270,000 worth of goods to the U.S. in 2022. They're getting hit with a 29% tariff. And there's also a herd island. and McDonald Island, which are run by Australia's office for Antarctica. There aren't even people living on that island instead it's home to a large colony of penguins. Well, they just got hit with a 10% tariff as well. So even the penguins are going to have to pay up.

Well, all right, guys, that's the rundown for today. Absolutely wild day. I'm still taking in all the information, still processing everything. We got one more episode for you guys tomorrow. It's going to be a big one because we're getting the jobs report. So that might add fuel to this sell-off or maybe it might be some release. So it's a great time to get subscribed to the pod and we're going to make sure you guys stay in the loop

of everything that's happening right now. And if you guys enjoyed the show and have like 10 extra seconds, consider giving us a five-star rating on Apple or Spotify. If you're listening on Spotify, don't forget to vote in today's Spotify poll. Leave us a comment on Spotify. All that engagement really does help us out and it helps other people find the show. Thank you guys again for listening.

Shout out to Mike and Connor for all the help behind the scenes and we'll see you guys back here tomorrow. This is the rundown, your real-time resource for news events and trends in the markets. All views presented in the show reflect the opinions of the guests. You should not take any mention of a publicly traded security as recommendation to buy, sell, or hold that security. Rundown guests are not financial advisors and are not affiliated with public holdings or its subsidiaries. You should make your own financial and investment decisions or consult. Respective professionals. Learn more at public.com disclosures.

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