WSJ What’s News - Markets Plummet as Concerns Around U.S. Recession Grow

Episode Date: March 10, 2025

P.M. Edition for Mar. 10. Stocks fell after President Trump’s refusal yesterday to rule out a recession. WSJ markets reporter Hannah Erin Lang discusses whether today’s stock selloff was just about the president’s remarks. Plus, the U.S. is a leading arms exporter, and Europe is a big buyer. But as reporter Alistair MacDonald explains, Trump’s policy towards Ukraine is making some in Europe reconsider buying arms from American companies. And Utah is set to become the first state to ban fluoride in its public water supply. WSJ national affairs reporter Kris Maher discusses why it may not be the last. Alex Ossola hosts. Sign up for the WSJ's free What's News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices

This episode is sponsored by Northern Trust Wealth Management. There is more to being a successful entrepreneur than just good business practices. What is it about an entrepreneur's childhood that helped fuel their entrepreneurial spirit? What are entrepreneurs doing to cultivate this spirit in their own children and build a legacy beyond their business? Tune in each month to the Road to Why podcast by the Northern Trust Institute, where host Eric Schapea dives deeper with leading entrepreneurs on these topics and more. Find the road to why where you listen to your favorite podcasts. Markets slide as concerns about a recession in the U.S. grow. Plus, President Trump's

policy on Ukraine is worrying European buyers of American weapons. European officials looking at what's happening and thinking, if the US is willing to cut off weapons delivery so suddenly and cut off all that comes with that, such as maintenance and spare parts, then is it a safe bet for us now? And why states want to remove fluoride in public water. It's Monday, March 10th. I'm Alex Osala for The Wall Street Journal. This is the PM edition of What's News,

the top headlines and business stories that move the world today. Stocks slid today as concerns about the US economy tipping into a recession grew. As we mentioned in this morning's show, during an interview on Fox News' Sunday Morning Futures, President Trump refused to rule out the U.S. entering a recession this year. In contrast, Commerce Secretary Howard Lutnick told NBC News, quote, there's going to be no recession in America.

All major U.S. indexes ended the day lower. The Dow dropped by nearly 900 points, closing down about 2%. The S&P 500 fell 2.7%. And the NASDAQ plunged by 4% as big tech companies extended their sell-off, its largest one-day percentage decline since 2022. Tesla stock lost about 15%, its worst day since 2020. Shares of the other magnificent seven stocks, Apple, Microsoft, Alphabet, Amazon, Nvidia, and Meta, fell between 2 and 5 percent. For more, I'm joined now by Hannah Aaron-Lange, who covers markets for the Journal. Hannah, is all this just about the president's comments, or are there deeper worries here? It's a little bit of both.

One thing that did seem to really rattle markets today were those comments that Donald Trump made over the weekend. Of course, we had Howard Lutnick, the Commerce Secretary, later say that there will be no recession in America. But it does seem there was damage done from those Trump comments. And it wasn't so much his answer specifically as much as what I signified about his approach to policy and how he's thinking about

markets in his second term. And what does it signify? These comments and also just the last few weeks on Wall Street have signaled what looks like a real shift in how investors are thinking about Donald Trump and his presidency and the economy right now. In the weeks immediately following Trump's victory, investors were pretty thrilled about what Trump could bring for the stock market and for investors. That carried through to the new year. Even as Trump was inaugurated, started overhauling the federal government, started to threaten tariffs, there was still that sense of enthusiasm, but I started to notice a shift when that first round of tariffs on

Canada and Mexico first took effect earlier this month. Of course, there were changes shortly after, but what I called money managers and market watchers the day that that first implementation happened happened there was this kind of shock I heard from from the folks I talked to. There's the sense that all of this tariff talk and these threats had been a negotiating tactic or all bluster and some of the reactions I heard were I can't believe he actually did it. So that's a little bit of what's happening right now is that investors are starting to realize

that Trump might not be as friendly to or as concerned about the stock market as they had initially wanted or hoped for. And then layered on top of that, you have some broader concerns about the health of the US economy. That was WSJ reporter Hannah Aaron-Lange. Thank you, Hannah.

Thank you for having me. Lumber producers have migrated from Canada to the American South. Now Lumber's futures trading is moving south too. The exchange operator CME Group has said it would launch trading in Southern Yellow Pine futures on March 31st. Ryan Dezembre, who covers commodities for the journal,

joins me now. Okay, Ryan, why is this happening? Well, this has been discussed by the exchange operator and traders for a long time as the South has become the sort of top lumber producing region in the continent. And why now? The price of the lumber that's coming from Canada, a northern species, the price has risen pretty dramatically and separated from the price of southern yellow pine. It's like 50, 60 percent higher now. And a lot of that is being driven by the duties that are existing on Canadian wood that is shipped into the U.S. and of course Trump's tariffs, which he said he's going to put 25 percent on top of those existing duties.

What will this mean for U.S. producers? This would give them something to hedge production, like a corn farmer might buy corn futures to lock in prices and a food company might trade futures to protect their prices of the corn that they're buying. Same thing for lumber. And this would give them a tool to do that that's a lot more relevant to what they're buying. Same thing for lumber. And this would give them a tool to do that that's a lot more relevant to what they're doing than the existing lumber futures, which is a contract that's fulfilled by northern species of wood, predominantly from Canada. That was WSJ reporter Ryan Dezembre. Ryan, thank you.

Thank you. Utah is set to become the first state to ban fluoride in the public water supply, after Governor Spencer Cox said he would sign a bill to do so. The Utah law is set to take effect in early May. That's just one state considering rolling back efforts to add fluoride to water. In 2022, about 63% of Americans had tap water with fluoride in it. But now that number is shrinking. In Florida, at least 23 cities and counties have removed fluoride since it. But now that number is shrinking. In Florida, at least 23 cities and counties

have removed fluoride since September. And eight of 12 states mandating fluoridation face bills ending those requirements. For more, I'm joined by WSJ National Affairs reporter Chris Marr. Chris, what is at issue here exactly? So the opposition to fluoridation really ramped up last year.

There was a report by a group called the National Toxicology Program, which is part of the federal government. And they took a look at some human health studies involving fluoride. And their conclusion, which they said was with moderate confidence, was that the greater the fluoride exposure, the lower the IQ scores for youth that had been exposed or their mothers have been exposed. And then a month later, a federal judge told the EPA that it had to take some action because of the findings of this study.

But for a long time, the mainstream belief was that there were no problems with this whatsoever. It was effective at helping prevent cavities, tooth decay, a lot of dental groups, the American Dental Association, some health organizations. In fact, the EPA and the CDC have always been in favor of fluoridation and the CDC has considered water fluoridation one of the top health achievements of the 20th century. And what is the Trump administration saying about this?

Back in the fall when the federal judge told the EPA that they had to take some sort of action, the EPA had they had to take some sort of action, the EPA had said that it was going to be filing an appeal. But that was before the Trump administration came in and Robert F. Kennedy became the top health official in the United States. So it's unclear right now what position the Trump administration is going to take. That was WSJ Reporter Chris Marr. Thank you Chris.

Thanks so much. Coming up, could Europe wean itself off American defense companies? That's after the break. This episode is sponsored by Northern Trust Wealth Management. There is more to being a successful entrepreneur than just good business practices. What is it about an entrepreneur's childhood that helped fuel their entrepreneurial spirit? What are entrepreneurs doing to cultivate this spirit in their own children and build a legacy beyond their business? Tune in each month to the Road to Why podcast by the Northern Trust Institute, where host Eric Schapea dives deeper with leading entrepreneurs on these topics and more. Find the Road to Why where you listen to your favorite podcasts.

to your favorite podcasts. American defense companies are dominating the global arms trade. According to the Think Tank Stockholm International Peace Research Institute, the U.S. accounted for 43% of global weapons exports over the past five years, up from 35% in the previous five-year period. Europe has been one of the biggest buyers.

As European defense budgets have risen in the wake of Russia's invasion of Ukraine, the U.S. arms industry has been the key beneficiary. Now though, that could change. Alastair MacDonald covers Ukraine and the defense industry for the Wall Street Journal and is here to tell us more. So Alastair, how are U.S. arms sales expected to be affected after last week's news, which is the Trump administration cutting off deliveries of US weapons, spare parts, and intelligence to Ukraine. I would describe it as a debate at the moment. European officials are looking at what's happening and thinking, if the US is willing to cut off weapons deliveries so suddenly

and cut off all that comes with that, such as maintenance and spare parts, then is it a safe bet for us now? And the thing is, is that US weapons exports are so huge to Europe now that it's problematic for them. They've more than doubled in five years basically and it's around two-thirds of imports now come from the US up from just over half in the previous period. This is according to SIPRI's numbers. So it's a substantial chunk of European buying, but it also comes at a time when some European nations are saying, well, we should prime our own defense industries anyway. So the Trump administration has talked a lot about Europe being more independent from the U.S. when it comes to defense. And this may be a potentially unwanted consequence because there are some very large, sophisticated

defense companies in Europe. We've been hearing a lot about NATO and how President Trump is pushing member nations to increase their military spending. Where would that money go? It's going in the US actually. Lockheed Martin is rubbing its hands as we speak. RTX is over the moon. A lot of the increase has gone to US companies.

Everybody actually looks at it and thinks this is a current phenomena, but President Trump said this at the start of his first term and it didn't get a lot of fight back in Europe. So it's been ramping up really for the past 10 years and then this has given it an extra push. The British who are traditionally Europe's biggest defense spenders, they've agreed to spend even more. The Danes have and now the Germans are as well.

And I would imagine more will follow. So European defense companies benefit from that and you've seen a massive rally in the shares of European defense makers as a result of that. But a chunk of this is going across the Atlantic to US defense companies. That was WSJ reporter Alistair MacDonald. Thank you, Alistair.

Thanks, Alex. In other news, President Trump said immigration officials will be pursuing other student organizers like Mahmoud Khalil, a Columbia University student who helped lead last year's pro-Palestinian demonstrations. According to his lawyer, Khalil was detained Saturday night by Department of Homeland Security agents who said they were acting on orders from the State Department

to revoke his green card. And finally, cars have gotten a lot more high tech. But not everyone is into it, and many drivers actually say it's too much. Personal finance reporter Joe Pinsker talked to our tech news briefing podcast about what exactly people are complaining about. One critique is that some of this is just all too much. They want to be able to just do simple stuff like turn on the AC in their car and not have to tap a touchscreen a few different times while taking their eyes off the road. A lot of this technology is actually quite great when it works really well and in general,

people actually kind of want stuff in their cars. The problem is that a lot of it's just hard to use and often breaks down. There are all these ways in which tech can make things better when they work, but when they don't, it is a real nuisance to a lot of people. To hear more from Joe,

check out today's episode of Tech News Briefing. And that's what's news for this Monday afternoon. Today's show was produced by Anthony Bansi with supervising producer Michael Kazimides. I'm Alex Osola for The Wall Street Journal. We'll be back with a new show tomorrow morning. Thanks for listening. This episode is sponsored by Northern Trust Wealth Management.

There is more to being a successful entrepreneur than just good business practices. What is it about an entrepreneur's childhood that helped fuel their entrepreneurial spirit? What are entrepreneurs doing to cultivate this spirit in their own children and build a legacy beyond their business? Tune in each month to the Road to Why podcast by the Northern Trust Institute,

where host Eric Shopea dives deeper with leading entrepreneurs on these topics and more. Find the Road to Why where you listen to your favorite podcasts.