WSJ What’s News - Nasdaq Has Its Worst Week Since April

Episode Date: November 7, 2025

P.M. Edition for Nov. 7. Falling tech stocks drove the Nasdaq down 3% this week. WSJ markets reporter Hannah Erin Lang discusses what’s got investors on edge. Plus, flight cancellations due to the government shutdown scrambled travelers’ plans today, but it could get even worse, with up to 20% of flights nixed as the shutdown continues. And Microsoft’s AI chief lays out the company’s new artificial intelligence vision separate from OpenAI. WSJ tech reporter Sebastian Herrera joins to discuss. 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 podcast is brought to you by Dinotrace, the leader in AI-powered observability, with analytics, automation, and next-level intelligence on one unified platform. DynaTrace delivers the visibility and real-time insights you need to deliver better, more secure software, successful AI initiatives, and innovation at the speed of business. Turn data into decisions that drive your business forward with AI-powered observability where it counts. Learn more at dinatrace.com slash WSJ. That's www.d-d-D-Y-N-T-R-A-C-E dot com slash WSJ. Microsoft is laying out its AI vision, separate from long-time partner OpenAI.

Microsoft's goal is to not have to rely on OpenAI for any of its tech. That's what they're working toward, but it's going to take some time for them to separate from Open AI. Meanwhile, investors jitters around artificial intelligence send the NASDAQ to its worst week since April. And travelers' pain over canceled flights might get even worse. It's Friday, November 7th. I'm Alex O'Sullough 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.

It's been a dramatic week in markets. The AI boom has driven stocks sky high, and this week, investors' confidence in that wavered. Here's journal markets reporter Hannah Aaron Lang. Obviously, the AI trade kind of dominates the entire stock market right now, and it's being powered by these major tech companies that are spending billions and billions of dollars to rapidly build out these capabilities. And the big question that investors have is, is all of this money that we're spending going to be worth it? Is the price that I'm paying for this stock justified by what those profits will look like down the line? And stock valuations are quite high right now.

We've seen those jitters kind of reach a fever pitch this week and spread throughout the market and ultimately drive stocks lower. And reports on mounting job cuts and anxious consumers caused worries, especially in the absence of economic data from the government during the shutdown. A monthly survey from the University of Michigan shows consumer sentiment in November falling to near record lows. The NASDAQ had its worst week since April, closing down 3% over the five trading sessions. For the week, the S&P 500 dropped 1.6. percent, while the Dow ended down 1.2 percent. For today alone, though, trading was mixed after some steep declines earlier in the week, with small gains for the S&P and the Dow and a slight retreat in the NASDAQ. If you're traveling today, chances are you're feeling the effects of flight delays

and cancellations. The Federal Aviation Administration has ordered traffic cuts at 40 airports to keep skies safe during the government shutdown. It's starting with traffic cuts of 4 percent today, and airlines have canceled hundreds of flights. That's not that big a deal by historical standards. But cuts are supposed to grow to 10 percent by next Friday. And then things might get even worse. So if this shutdown doesn't end relatively soon, the consequence of that is going to be more controllers don't come to work. And then we're going to have to continue to assess the pressure in the airspace and make decisions that may again move us from 10 percent to 15 percent, maybe to 20. That was Transportation Secretary Sean Duffy on Fox News this afternoon.

Flight reductions are expected to continue until the end of the shutdown. If you're flying soon, keep an eye on your email or airline app for updates. If your flight gets canceled, the airline will typically put you on another flight, though you have the option to accept or reject it. The White House is pushing to ramp up deportations, and that's causing infighting at the Department of Homeland Security. over which tactics to use to remove people from the U.S. That's according to people familiar with the matter.

Michelle Hackman covers immigration policy for the journal and is here now with more. Michelle, as I understand it, there are two kind of schools of thought here. What is each one saying and who are the big names in each? At DHS, they're traditionalists, and a lot of those people are at ICE. And they believe they have the tools to be able to carry out Trump's mass deportation, and that involves using policing methods, like coming up with target lists of immigrants, trying to catch them outside of their homes,

trying to go after criminals first because it's easier to deport those people. Their tactics and methods were not big and splashy enough for some at the top of DHS, like Christy Noam. And so we've seen some other approaches emerge, too. Greg Bovino, he's a Border Patrol veteran, started running this big campaign in Southern California where he was taking his border.

Border Patrol agents and doing like big raids on farms and factories. They were really crucially putting those raids on social media, posting videos. And so Christy Nome asked Greg Bovino to go lead operations in L.A. and later brought him to Chicago. You've probably seen tons of videos of people getting arrested on the street in Chicago, getting tackled. And people think that's iced because that's who does deportations, right? But it actually is the Border Patrol carrying all that out. And what has DHS said about this publicly? A DHS spokeswoman told us and has said publicly numerous times

that there are no divisions of DHS, that they're basically rowing in one direction and that they expect to carry out about 600,000 deportations by the end of Trump's first year in office. I'm curious about the political implications here. So there was a WSJ poll that was published in July that showed that voters, said they supported President Trump's immigration curbs, but said that the tactics went too far.

What does this mean for President Trump? The mass deportation is a really salient question for Trump's supporters. And so it could have a dampening effect of support if Trump is seen as not meeting that goal. Will people be satisfied with flashy tactics, or are they ultimately going to want to see numbers? On the other end of things, we've seen really preliminary evidence that some of these immigration raids have had a dampening effect on Hispanics moving toward the Republican Party. We saw swing back among Hispanic voters toward Democrats in elections this week. The question is whether ICE raids become one of the most salient issues to those voters or whether they're thinking about other things when they go to

the ballot box next year. That was WSJ reporter, Michelle Hackman. Thanks, Michelle. Thank you. Coming up, what does Microsoft's AI program look like without OpenAI? That's after the break. Microsoft and OpenAI have had an artificial intelligence partnership for years. Now, though, Microsoft's top artificial intelligence executive has laid out a new vision for the company's AI ambitions. Here's Microsoft's AI chief Mustafa Suleban. We are free to develop our own superintelligence and become AI self-sufficient. And for a company, you know, with $300 billion of revenue and, you know, three trillion of money, market cap, been around 50 years, we have to be self-sufficient. And that's like a mission-critical

objective, which the board has set. WSJ tech reporter Sebastian Herrera joins us now. So Sebastian, what's in Microsoft's new AI plan and how does it diverge from OpenAI? Yeah, so Microsoft is creating this new superintelligence team. And the way that they're diverging from Open AI is if you think of Open AI, they're really known for conversational AI. And it's like you're talking to a human being. And Microsoft's approach is that we're not trying to work so much on trying to have these conversations where it's like human-like.

If anything, they say talking to AI and interacting with AI shouldn't be like talking to a human. We shouldn't over-empathize with it. It's actually here to help us solve the world's hardest problems. It's here to help us solve health care and science and clean energy problems. And that's how they're trying to separate what they're doing from what. what their partner, OpenAI, is doing. So Microsoft and OpenAI are still partners for now,

but it sounds like they're also going to be a bit more of competitors. Do the two expect to one day separate completely? And if so, what would that take? It is a bit of an awkward relationship because Microsoft still relies on OpenAI for a lot of its tech. Microsoft and OpenAI are still really close partners, and they still have a contract that goes through at least 2032, Microsoft is also a huge investor in open AI, so they're still very much tied financially to

Open AI. However, part of the reason that Microsoft is trying to create its own tech is that if Open AI doesn't exist in five years, Microsoft still wants to have their player in the game. They still want to be able to make their own impact on AI. Microsoft's goal is to not have to rely on Open AI for any of its tech. That's what they're working toward. That's what this new superintelligence team at the company is working toward, but it's going to take some time for them to separate from Open AI. We heard earlier from Microsoft's AI chief, Mustafa Suleiman. Who is he, and where is he coming from on AI?

He has a pretty interesting journey. He's from London. He co-founded DeepMind, which was bought by Google. And then he went on to found Inflection AI, which he was at before Microsoft hired him to become it's AI chief executive. So he's been in the industry for a long time. He hasn't necessarily ever created a hit product per se,

but he is thought of as someone who's really trying to push this tech forward. I should note that Microsoft is seen as being pretty behind Open AI. And internally, Microsoft employees feel like they're still years away from being able to replace Open AI technology with Microsoft's own technology. Microsoft has really big ambition. They talk a very big sort of game, but they're not necessarily matching it yet. That was WSJ reporter, Sebastian Herrera. Thanks so much, Sebastian.

Thank you. Shipments of Nixperia microchips are leaving China again, easing a shortage of simple but ubiquitous parts that threatened to paralyze the auto industry. Beijing had stopped exports of Nixperia chips after the Dutch government seized the company from its Chinese owner. The diplomatic turning point on the chips came after last week's meeting between President Trump

and Chinese leader Xi Jinping. And Wendy's said it would close hundreds of its roughly 6,000 U.S. restaurants. The company also said low-income consumers in particular are facing challenges right now. In the restaurant industry, some chains have reported consumers

are cutting spending, making fewer trips, and smaller purchases. And that's what's news for this week. Tomorrow you can look out for our weekly markets wrap-up What's News and Markets. Then on Sunday, we'll be featuring an episode of our sister podcast, WSJ's Take On the Week.

It digs into one of the biggest business stories at the moment, Paramount Skydance's pursuit of Warner Brothers Discovery. That's in What's News Sunday. And we'll be back with our regular show on Monday morning. Today's show is produced by Pierre Biennameh and Zoe Colkin, with supervising producer Tali Arbell. Michael LaValle wrote our theme music. Jessica Fenton is our technical manager.

Isha El-Muslim is our development producer. Chris Zinsley is our deputy editor, and Falana Patterson is the Wall Street Journal's head of news audio. I'm Alex Osala. Thanks for listening.