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

1.923 - 21.659 Jack Pitcher

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.

22.776 - 43.95 Jack Pitcher

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.

44.49 - 64.936 Jack Pitcher

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 percent, while the Dow and the Nasdaq were both 2.5 percent lower.

67.774 - 86.448 Jack Pitcher

Apple investors appear to be taking Trump's threats seriously. As I said earlier, the president said he expects iPhones sold in the U.S. to be made in the U.S. or face a 25% tariff. Apple's phones are sourced from many countries and primarily put together in China. Apple doesn't have U.S. manufacturing facilities.

87.109 - 113.331 Jack Pitcher

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.

114.012 - 136.624 Jack Pitcher

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.

137.244 - 157.948 Jack Pitcher

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.

158.748 - 182.648 Jack Pitcher

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.

183.108 - 199.601 Jack Pitcher

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.