Traders work on the floor of the New York Stock Exchange on March 28, 2025, in New York City.
Spencer Platt | Getty Images
Monday was the last trading day of the quarter. U.S. stocks took a heavy beating during the period: Both the S&P 500 and Nasdaq Composite broke their five-quarter winning streaks and suffered their heaviest three-month losses since 2022. The Nasdaq remains in correction territory.
But it won’t be the last tumult stocks will experience. Reciprocal tariffs on “all countries” will start Wednesday, U.S. President Donald Trump said Sunday. While Trump has described the start of his tariffs as “liberation day,” others aren’t seeing it in quite so glowing terms.
Goldman Sachs, for one, cut its forecast for U.S. economic growth and raised its expectation for the inflation rate in 2025, suggesting the possibility of stagflation. And if not stagflation — recession. The Wall Street giant also slashed its projection for the S&P 500 accordingly.
If the first quarter of the year was bumpy, the second could be much more treacherous.
What you need to know today
Tariffs on ‘all countries’
U.S. President Donald Trump said that his reciprocal tariff will target “all countries” when they are announced Wednesday. He explicitly dismissed suggestions that tariffs will only apply to the “Dirty 15” — a group of countries making up 15% of U.S. trading volume while imposing hefty tariffs on American goods. Goldman Sachs raised its recession probability in the next 12 months to 35% from 20% because of Trump tariffs.
Economists expect low growth
Economists polled by the CNBC Rapid Update also expect tariffs to slow — perhaps even stall — the U.S. economy. The Rapid Update, averaging forecasts from 14 economists for GDP and inflation, sees first quarter growth registering an anemic 0.3% compared with the 2.3% expansion reported in the fourth quarter of 2024. It would be the weakest growth since 2022 as the economy emerged from the pandemic.
Bloody quarter for U.S. stocks
U.S. markets traded mixed Monday, capping off a dismal first quarter. The S&P 500 rose 0.55%, the Dow Jones Industrial Average increased 1% but the Nasdaq Composite dropped 014%. For the quarter, the S&P 500 dropped 4.6%, the Dow lost 1.3% and the Nasdaq tumbled 10.4%. The pan-European Stoxx 600 index slumped 1.51% Monday. However, the Stoxx 600 is still up more than 4% for the year, according to LSEG data, outperforming the S&P 500.
OpenAI’s humongous funding round
OpenAI on Monday announced it had closed a $40 billion funding round — the largest private tech funding round on record — which values the ChatGPT maker at $300 billion, including the fresh capital. Japan’s SoftBank is leading the round with $30 billion, and is joined by Microsoft, Altimeter and Thrive. However, funding would decrease to $30 billion if OpenAI doesn’t restructure into a for-profit entity by Dec. 31, CNBC has confirmed.
Is DOGE slashing Tesla monies too?
Tesla’s stock plunged 36% in the first three months of the year, its worst quarter since 2022, when the stock cratered 54%. Tesla’s first-quarter drop wiped out over $460 billion in market cap. CEO Elon Musk acknowledged at a town hall event in Wisconsin, U.S., that his role with the so-called Department of Government Efficiency is creating backlash against Tesla and hurting the stock.
[PRO] Goldman cuts S&P forecast
In addition to lowering its forecast on economic growth, Goldman Sachs also slashed its projection of where it thinks the S&P 500 will be at the end of 2025. It’s the lowest estimate among major Wall Street firms, according to the CNBC Market Strategist Survey.
And finally…
Sebastian Siemiatkowski, CEO of Klarna, speaking at a fintech event in London on Monday, April 4, 2022.
Chris Ratcliffe | Bloomberg via Getty Images
After 20 years at the helm, Klarna CEO Sebastian Siemiatkowski faces his biggest test yet: A U.S. IPO
Sebastian Siemiatkowski co-founded Klarna in 2005 with fellow Swedish entrepreneurs Niklas Adalberth and Victor Jacobsson with the aim of taking on traditional banks and credit card firms with a more user-friendly online payments experience.
Today, Klarna is synonymous with “buy now, pay later” — a method of payment that allows people to buy things and either defer payment until the end of the month or pay off their purchases over a series of equal, interest-free monthly installments.
Now, Klarna’s CEO faces his biggest test yet — taking the business he co-founded two decades ago public. If it succeeds, the outcome could catapult the net worth of Siemiatkowski and other shareholders including Sequoia Capital, Silver Lake, Mubadala Investment Company, and the Canada Pension Plan Investment Board.