Trump dealt an unexpected blow to Wall Street

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Good morning. At a White House event yesterday, Trump's handwritten notes were once again caught on camera. This time, they read like a Tesla sales pitch.

In today's big story, Wall Street assumed that the stock market would act as a check on Donald Trump's new administration. That isn't panning out.

What's on deck

Markets: February was a bad month for big-name hedge funds. March is looking worse.

Tech: BI reviewed a copy of xAI's internal org chart. Here's who's reporting to Elon Musk.

Business: Southwest as you know it is going, going, gone.

But first, Wall Street is getting cut out of Trump 2.0.

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The big story

Another wild day on Wall Street

The stock market's volatility has been dizzying.

After a brutal sell-off on Monday, which saw the worst session for the Nasdaq since 2022, the markets plunged deeper into the red yesterday. This week has been nothing short of jaw-dropping, and it's not over yet.

The markets have been responding to President Donald Trump's tariff policy and his commitment to pushing forward with a trade war against some of America's biggest partners, including Canada and Mexico, BI's Matthew Fox writes.

The president had announced a plan to double US tariffs on Canadian steel and metal imports to 50%, in retaliation to Ontario imposing a 25% tariff on the electricity it exports to the US.

Hours later, this was no longer the case. Trump reversed course after Canada suspended the new electricity charges. US tariffs of 25% on metal imports — including from Canada — still took effect today.

Europe, which is also impacted by the latest tariffs, hit back this morning, announcing tariffs on $28.4 billion worth of US goods, including on boats, bourbon, and motorbikes.

So far, a surprising loser has emerged in Trump's second term: Wall Street.

As markets have started to flash warning signs about the tariff whiplash, the Trump administration's response has been a bit of a shrug, BI's Emily Stewart writes. Trump 2.0 isn't as concerned about investors' feelings — or, more importantly, holdings — as they'd hoped.

It's a sharp contrast to Trump's first administration, which in part tracked its success through the lens of the stock market. So, what's changed? As Emily writes: One man stood between Trump and a recession. Now he's gone.

3 things in marketing

1. It's getting harder for markets to ignore the weakening US consumer. Consumer strength has been a pillar of the post-pandemic economy, but a weaker outlook for consumer demand has slashed first-quarter expectations for airlines and retailers. Inflation, high interest rates, and tariff uncertainty are pushing shoppers into a save-not-spend mindset.

2. No "Miracle March" in sight for big-name hedge funds. After a dismal February performance, things aren't looking up for large multistrategy firms. Millennium, Point72, and Schonfeld have all lost money in March, according to people close to the managers. The funds, known for making money even amid market volatility, can't shake the volatility caused by Trump's trade policy.

3. Ron Baron's firm sold some Tesla shares. Baron Capital shed some shares after it faced concerns its position was too large, but its founder isn't ditching the automaker. Baron has no plans to ditch his personal shares, and he's maintained a bullish stance despite the stock's recent troubles.

3 things in tech

1. Who's in charge at Elon Musk's xAI. BI reviewed a copy of xAI's internal org chart to identify the people steering the ship at the AI venture as of early this year. The chart features former Tesla and Google engineers, Musk's son, and five direct reports, including Daniel Rowland, whose involvement in the company hasn't been previously reported.

2. The 40 tech companies that file the most H-1B immigrant work visas. The tech sector, which relies on global talent, could be hit especially hard by Republican attempts to curb visas. See the tech companies that filed the most H-1B visa requests in 2024, including giants like Amazon, Meta, Microsoft, and Google.

3. Larry Page wants to 3D-print your airplane. The Google cofounder has a new startup exploring how AI can advance airplane manufacturing, and he's tapped the former CTO of his flying car startup Kittyhawk to run it. Here's what we know about Dynatomics and its appointed leader Chris Anderson.

3 things in business

1. Everything you used to LUV about Southwest is gone. Once upon a time, Southwest Airlines offered two free checked bags and open seating, perks that helped distinguish it from its competitors. Those days are gone, though; the Texas-based carrier has virtually abandoned its once-sacred practices as it struggles to regain a footing in the competitive airline industry.

2. A $9 pour-over with a side of world domination. SoHo's hottest new daytime haunt is La Cabra, the coffee shop across the street from OpenAI's office. Its proximity to the tech company has made the Danish café an unlikely hub for hungry New Yorkers.

3. Zuck's most awkward moments. Social snafus were a common occurrence when Mark Zuckerberg met with world leaders. That's according to former Facebook executive Sarah Wynn-Williams, who shared five toe-curling incidents in her memoir, "Careless People."

In other news

• Vandalize a Tesla dealership? Trump says he'll label that domestic terrorism.
• Ukraine's on board with a cease-fire deal. Now, Trump just has to get Russia to stop attacking it.
• Peter Kafka: The media is bending to Trump in lots of ways. Tony Hinchcliffe's Netflix deal doesn't seem like one of them.
• DOGE's anti-DEI drive flagged these programs. Only they weren't DEI.
• Investors' faith in King Dollar may be wavering.
• Millennials are obsessed with baby tech. But does it really make parenting easier?
• Flightmare of the Week: Nine-hour flight to nowhere after eight bathrooms stopped working when bags, rags, and clothes were flushed.
• McDonald's CEO is trying to speed up the years it takes to develop new burgers.
• Four things on a résumé that matter way more than the college you attended, according to a tech and finance recruiter.

What's happening today

• CPI data released.
• G7 foreign ministers meeting.

The Insider Today team: Dan DeFrancesco, deputy editor and anchor, in New York. Grace Lett, editor, in Chicago. Ella Hopkins, associate editor, in London. Hallam Bullock, senior editor, in London. Amanda Yen, associate editor, in New York. Elizabeth Casolo, fellow, in Chicago.