WSJ What’s News - What’s News in Markets: iPhone Tariffs, Target Backlash, Ross Stores Trade Woes

Episode Date: May 24, 2025

How did Trump’s latest threats hurt Apple? And how did a DEI boycott affect Target’s latest quarter? Plus, why was Ross Stores the latest company to pull its outlook? Host Jack Pitcher discusses the biggest stock moves of the week and the news that drove them. Listen: Boycotting Target: A WSJ Podcast Series Sign up for the WSJ's free Markets A.M. newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices

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Hey listeners. It's Saturday, May 24th. I'm Jack Pitcher for The Wall Street Journal. And this is What's News in Markets. Our look at the biggest stock moves of the week and the news that drove them. Let's get to it! The trade war was back in focus this week after President Trump on Friday launched new broadsides in his tariff campaign. He threatened to impose a 50% tariff rate on the European Union within days and warned of possible 25% tariffs on foreign-made iPhones. Those are two pillars of global commerce, One of the world's most valuable companies, Apple, and one of the U.S.'s biggest trading

partners. Another market mover this week was the president's sprawling tax and spending package. The House of Representatives passed it on Thursday, and it's headed to the Senate. The bill is projected to increase budget deficits by more than $2 trillion over the next decade, raising anxiety over the U.S. fiscal outlook and prompting a government bond sell-off. For the week, the S&P 500 dropped 2.6%, while the Dow and the Nasdaq were both 2.5% lower. Apple investors appear to be taking Trump's threats seriously. As I said earlier, the president said he expects iPhones sold in the US to

be made in the US or face a 25% tariff. Apple's phones are sourced from many countries and primarily put together in China. Apple doesn't have US manufacturing facilities. And industry experts say efforts to build iPhones domestically would take years of investment. Apple CEO Tim Cook met with Trump in the White House earlier this week. The company declined to comment on Trump's most recent tariff threat. The iPhone maker's shares fell 3% Friday. Now let's talk about one of the country's biggest retailers,

Target. On Wednesday, the company set a laundry list of problems, dragged down its quarterly sales. One issue? A boycott by shoppers who disagreed with Target's decision to end some DEI programs. Target was once an outspoken corporate diversity advocate, but it ended its workforce and supplier diversity programs in January. Then diversity advocates called for a boycott on the company. Target's CEO told investors that played a role in the lackluster

first quarter performance. Target said softer spending on discretionary items—those are things that people want but don't need—and a decline in consumer confidence also hurt results. Target's comparable sales fell 3.8% in the most recent quarter, a bigger drop than analysts expected. And the company cut its forecast for the fiscal year, citing uncertainty around tariffs and the economy. The retailer shares fell 5.1% Wednesday and 4.4% this week. And you can hear more about Target's rollback of DEI policies and the impact of consumers boycott on the company and the black entrepreneurs with products on Target's shelves in our special two-episode series, Boycotting Target.

We'll leave a link to the series in the show notes. Apple and Target are far from the only companies contending with tariffs. Ross Stores, the discount clothing chain, on Thursday withdrew its sales and earnings guidance for the year because of uncertainty from tariffs. A range of companies, from toy, car, and shoemakers to hotel chains, have pulled or slashed their outlooks this year, citing economic and trade concerns. Ross expects tariffs will cut into earnings this quarter. The company said more than half of its products originate from China, and tariffs will pressure

its profitability if those levies remain at current levels. Ross shares dropped 9.9% on Friday and more than 10.2% on the week. And now you know what's news in markets this week. Today's show was produced by Michael Laval and Pierre Biennemy with supervising producer Tali Arbel. I'm Jack Pitcher. Have a great weekend!