P.M. Edition for Mar. 28. Stocks sold off after hotter-than-expected inflation data, President Trump's tariff announcements and souring consumer sentiment. But does consumer sentiment actually mean a change in consumer behavior? Economics reporter Justin Lahart joins us to discuss. Plus, cloud computing startup CoreWeave made its highly anticipated IPO today turned into a high-profile stumble. Corrie Driebusch, who covers finance for the Journal, tells us what this means for artificial-intelligence companies, and for IPOs more broadly. And President Trump has embarked on a sweeping deregulatory drive. Reporter Scott Patterson explains what sectors are feeling the effects, and what investors make of it. Alex Ossola hosts. Bad Bets podcast Sign up for the WSJ's free What's News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices
Chapter 1: Why did U.S. stocks fall sharply in March?
U.S. stocks sell off after consumer sentiment sours in March. But will consumer behavior change? Plus, CoreWeave's stock market debut turns into a high-profile stumble for both the AI industry and new public listings. And President Trump is following through on his pledge of sweeping deregulation.
Chapter 2: How do tariffs and inflation affect investor reactions?
Deregulation takes a while to work its way into the system. So you're not going to really see a benefit to companies from deregulation for a while. Whereas tariffs, inflation, interest rates, it's immediate. It's right now. And that's what investors are reacting to.
It's Friday, March 28th. I'm Alex Osola for The Wall Street Journal. This is the p.m. edition of What's News, the top headlines and business stories that move the world today. U.S. stocks sold off today after reports of lower consumer sentiment, hotter-than-expected inflation, and anticipation of Trump's announcement of further tariffs next week. Major U.S. indexes ended the day lower.
The Dow fell more than 700 points, or about 1.7%. The S&P 500 dropped about 2%, down for the week for the fifth time in the last six weeks. The Nasdaq tumbled 2.7%. New data from the Commerce Department show that U.S. personal income and consumption both rose in February.
The personal consumption expenditures price index, which the Fed uses to track inflation, rose 0.3 percent over the previous month and has climbed by 2.5 percent over the past 12 months, still above the Fed's 2 percent target. The core version of PCE inflation, excluding food and fuel, is up 2.8 percent over the past 12 months. That's an increase from January.
Meanwhile, consumers took a gloomier view of the economy in March. According to the University of Michigan's monthly survey of consumer sentiment, the headline index came in at 57 this month. That's the lowest level since 2022 and a decline from 64.7 in February. Two-thirds of consumers said that they expect higher unemployment in the next year, the highest reading since 2009.
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Chapter 3: Does consumer sentiment impact consumer behavior?
The numbers are the latest sign that consumers are feeling less optimistic about the economy. But does that translate into actual changes in consumer behavior? Here to tell us more about what this means is economics reporter Justin Layhart. Justin, what are some of the factors that are making consumers feel more negative about the economy?
Chapter 4: What factors are contributing to a decline in consumer sentiment?
A lot of it is just the headlines that you've been seeing. Tariffs, government layoffs, spending cuts, maybe immigration restrictions. You also have to consider with these measures of sentiment, they ask you, how are you doing? What are you seeing out there? So they can pick up things that maybe are happening on the ground that we're not seeing in the main economic data as of yet.
What kind of indicators do we look at to see if the sentiment turns into actual behavior?
We're going to be watching any kind of spending report, any kind of sales data. We definitely have seen some weakening in those measures this quarter so far. There was a decline in spending in January. People chalked that up to weather, to the Los Angeles fires. People thought, oh, you know, it's going to bounce back. It did bounce back a little bit in February, but not that much.
So we've seen economists are marking down their forecasts of gross domestic product. Morgan Stanley, for example, they're at 0.4 percent growth for the first quarter. That's pretty weak. So these surveys may be telling you something about what's happening.
That was WSJ economics reporter Justin Layhart. Thanks, Justin.
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Chapter 5: What went wrong with CoreWeave's IPO?
Thank you.
It was supposed to be one of the splashiest IPOs of the year. Now, CoreWeave's stock market debut is turning into a high-profile stumble. The startup that rents out access to NVIDIA chips priced its initial public offering below expectations late yesterday and opened even lower today. In the end, its shares closed flat. Cori Dreebush, who covers finance for the journal, is here now to discuss.
Cori, what went wrong for CoreWeave?
Chapter 6: How are current market conditions affecting AI companies?
a lot went wrong. It just ends up being a question of timing when it comes to IPOs. And often it's as simple as that. When you think about when a company started looking at an IPO, it's usually at least a year before they actually list their shares. A year ago, anyone with AI in their name, the stock was going up, up, up. And that sentiment has cooled a lot over these past 12 months.
Markets are down today. Is this just bad luck for the company? Or does it say something broader about how other AI companies could potentially perform in the market?
Yes. And I know I started out by saying that just poor timing, but there are company-specific issues. And investors said, no, we don't really want to pay that much. And they also had concerns about the sustainability of the AI boom. And obviously, companies right now are spending hundreds of billions of dollars on AI. But how sustainable is that?
Chapter 7: What does CoreWeave's IPO tell us about the 2025 IPO market?
Just thinking more broadly about IPOs, I mean, this is not the first IPO this year that has not lived up to expectations. What does CoreWeave's IPO tell us about listings this year?
Obviously, every IPO is a little different. But in general, bankers had really hoped that 2025 is going to be this return to normal for the IPO market. Instead, we've seen quite a few IPOs not do as well. And it's not all IPOs, but these are the bigger ones that have struggled. You think gas export or venture global in January. Obviously,
Another big IPO of the year was cybersecurity firm CellPoint. And that has also struggled since its IPO for its shares. And now there is CoreWeave. So it's not that all IPOs are doing poorly. But when you see a few of the three biggest in the U.S. not do so hot, it does cause some companies and their backers to maybe think, say, let's pause.
Other companies are still in the pipeline, still waiting to go, but we're going to have to wait and see how that goes.
That was WSJ Finance reporter Cori Dreebush. Thank you, Cori. Thanks. And more on that series of powerful earthquakes that rocked Myanmar and Thailand that we told you about in this morning's show. Myanmar authorities said that as of Friday evening, 144 people were confirmed dead, more than 700 were injured, and that the toll was expected to rise.
Thai authorities said that at least three people were killed in Bangkok, and dozens were injured when a high-rise building collapsed at a construction site. Coming up, what investors make of President Trump's efforts at deregulation. That's after the break. As he promised, President Trump is ushering in one of the most sweeping deregulatory drives in modern U.S. history.
Take the Environmental Protection Agency, which has so far seen the most aggressive plans for red tape rollback. In a single day, the EPA announced 31 actions to deregulate U.S. environmental policies, including rules for power plants, the oil and gas industry. electric vehicles, and wastewater. Scott Patterson, who covers the Trump administration for the journal, joins me now.
Scott, what are some of the industries affected by the president's deregulation efforts?
It probably would be shorter to say what industries aren't affected. The biggest ones are the chemical industry, rolling back oversight of toxic chemicals and the pollution that they can cause, oil and gas industry, finance, banking. It's across the board, though.
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