The Rundown - Trump Weighs Walking Back Auto Tariffs, Southwest Cuts Flights & Scraps Guidance

Episode Date: April 24, 2025

Stock market update for April 24, 2025.

Public.com presents the rundown. Your daily market update in five minutes. My name is Zaid Admani, and today is Thursday, April 24th. In today's episode, we're talking auto tariffs and why President Trump is thinking about walking them back. We also discuss issues at Southwest Airlines that has investors worried. Then stick around to the end of the show to find out how buying a meme coin could get you dinner with the president. We got a great show for you today. Let's Go. The market rally continued on Wednesday. The S&P 500 was up 1.7% and the NASDAQ jumped 2.5%. Investors still have their hopes up for a potential de-escalation of the trade war with China. President Trump keeps saying the tariff rate of 145% on China is too high. And now the Wall Street Journal is reporting that

the Trump administration is considering a move to cut China tariffs in half. But the president hasn't made a final decision on that yet. There are also rumored. is that President Trump might exempt automakers from tariffs. We're going to talk more about that in a bit. But on the flip side, China doesn't seem to be as optimistic about the whole thing. In fact, they came out and said that there isn't any ongoing trade talks with the U.S. And they're calling on the U.S. to cancel all the tariffs on China. Now, I highly doubt that's going to happen.

And this is why I'm hesitant to get my hopes up at all until we actually see some action and trade deals that bring these tariff rates down. I mean, I understand why the markets get really excited and start rallying from these rumors because traders don't want to be late to the party. But all that's doing is just adding more volatility to the stock market. So we'll see how it all shakes out. I mean, there's a lot for investors to process right now, especially with earnings coming out over the next few weeks. You know, we're going to recap some of the major earnings on today's show. And then tomorrow's show we're going to break down earnings from Google and Intel.

Both those companies report tonight. And then next week, we are getting a bunch of heavy hitters reporting, including Microsoft, Meta, Spotify, Apple. in Amazon. So there's a lot to look forward to. My screen time has already gone through the roof over the last couple weeks. But we're going to be locked in and we'll keep you guys updated every morning. So you don't want to miss any episodes over the next couple of weeks. Let's run through some headlines. President Trump is thinking about walking back some of his tariffs on automakers after getting pushed back from the industry. Currently, there's a 25% tariff on all foreign made cars and then another 25% tariff is set to go into effect for auto parts on May 3rd.

But the Trump administration is now considering some options that would eliminate the stacking of these tariffs. So that means that cars or parts already facing tariffs could be shielded from additional tariffs on steel and aluminum. Another option being considered is a full exemption of auto parts that comply with the USMC trade agreement. So that could mean that Canadian and Mexican auto parts might be safe from tariffs depending on sourcing rules.

And the Financial Times is also reporting that President Trump is planning to exempt car parts imported from China. So yeah, still a lot of unknowns here. It looks like the White House has heard the warnings from auto executives that tariffs would harm the industry, destroy their supply chain, and force them to raise prices. So any sort of tariff walkback would be a sigh of relief for the industry. But as usual with Trump's tariff policy, all of this is still fluid and it could change at any moment. In fact, just yesterday evening at the Oval Office, Trump said that he wasn't considering any changes, and he even threatened that tariffs on Canadian autos could go up.

In this country, I really don't want cars from Canada. So when I put tariffs on Canada, they're paying 25%, but that could go up in terms of cars. So yeah, man, this has got to be tough for auto executives. They probably have notification alerts on for Truth Social at this point. Let's talk about Southwest Airlines. They're also going through a rough patch right now. Southwest just announced they're cutting flights in the second half of this year because bookings are down, especially for domestic leisure travel, you know, which is kind of like their bread and butter. Southwest is pulling their financial guidance for both 2025 and 26 because of macroeconomic uncertainty.

That's pretty concerning because when companies can't accurately predict what they expect, that's usually not a great sign. And Southwest is not the only airline to do this. Delta also pulled their guidance. But the thing is, Southwest is also going through a major corporate makeover right now after pressures from activist investor Elliott Management. The company is ditching their famous bag-fly-free policy. They're also planning to add assigned seating, which I'm surprised it took them this long, but they're finally doing that. And they're also cutting their workforce.

They laid off over 1,700 workers so far. This is the first time in their company's history they've had to do layoffs. So tough times for Southwest Airlines. They did beat on Q1 earnings, but investors are more concerned about the picture moving forward. It doesn't look so pretty right now. So we'll see if Southwest can turn things around and land this plane. No pun intended. Let's talk about some stocks making moves today.

Hasbro is on the rise this morning after they easily topped their earnings and sales estimates for Q1. The toy maker saw their sales jump 17% in the first quarter, driven by strong demands for its wizards and digital gaming segment. That includes Magic the Gathering, Dungeons and Dragons, and Monopoly Go. I mean, that game is addicting. The Consumer Products Division, which includes brands like Marvel and Transformers, were down 4%. But that was still better than expected.

Hasbro stock is mooning this morning up almost 15% in reaction to these earnings. Now, the same can't be said for Chipotle. Their shares are dropping after the company reported its first same store sales decline since 2020. The burrito chain missed its first quarter revenue estimates, with the CEO pointing to a pullback in consumer spending. Chipotle also lowered its full-year sales forecast, citing rising ingredient costs and steep tariffs, like a 10% tariff on Australian beef,

and the 145% tariff on packaging from China. And then don't forget about avocados. Chipotle used to get 85% of its avocados from Mexico, but that has dropped down to about half since the company diversified its supply chain to include partners from Colombia, Peru, and Brazil. Chipotle is a big importer of avocados. They're responsible for importing 5% of all avocados coming into the U.S. last year. So yeah, Chipotle dealing with a lot of issues right now,

their shares were down more than 5% this morning, but I'm taking a look right now and the shares are backed about flat. So it seems like people are out here buying the dip. Let's wrap the show with a fun fact. Trump coin is back in the news. The presidential meme coin spiked 50% this week after it was announced that the top 220 holders of this coin would be invited to a black tie dinner with President Trump at his golf course in Washington, D.C. on May 22nd. And then if you're a top 25 holder, they get a VIP tour of the White House. So yeah, it seems like people are rushing in to buy Trump coin to take advantage of this offer.

Who said that crypto meme coins had no utility? The Hawk to a girl might have been ahead of her time, honestly. By the way, Trump coin is currently trading around $12 at the time of this recording. This is after the big spike this week. That's still way down from the $70 peak that the meme coin reached after it launched right before inauguration. Well, all right, guys, that's the rundown for today. Hope you guys enjoyed today's episode. We'll have a pretty big episode tomorrow to end the week.

We'll recap earnings from Google and Intel. And next week is just going to be an action-pack week with so many earnings. So a lot to look forward to over the next few weeks. Hope you guys are enjoying the content. If you are and you have like 12 extra seconds, consider giving us a five-star rating on Apple or Spotify. And 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 so much 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.

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