The ninja in the village, like Kakashi, would need to figure out how to handle this situation. They would have to ensure Naruto's safety while also trying to find a way to reverse the transformation. They might also have to deal with any potential threats that come as a result of Naruto's new form. For example, if other villages heard about it, they could try to take advantage of the situation.
Ino might be initially shocked. But then she'd probably be quite excited. She could start planning all sorts of things to do with Naruto, like shopping for new clothes or teaching her about girl - only ninja techniques. Ino would likely see it as an opportunity to have a new kind of friend.
The village would likely be overjoyed. Naruto is a hero in the Hidden Leaf Village, and Kushina was also respected. Their baby would be seen as a new hope for the village. People would probably shower the baby with gifts and love.
Hinata's family would also have to deal with the emotional aspect. They love Hinata in her normal state, and now they have to adjust to this new form. They might start to remember when Hinata was actually a baby before and all the hopes and dreams they had for her then. Some of the more conservative members of the family might be more hesitant to let Naruto be around her, but the more open - minded ones could see that Naruto's presence is actually good for her in this state. And they would all be united in their goal to get Hinata back to her normal self.
Sakura might be initially shocked and a bit jealous at how cute Naruto - as - a - girl is. Sasuke would probably be confused at first but then act indifferent. Kakashi would be his usual calm self, but might crack a few jokes about Naruto's new look.
Jiraiya would have a very interesting reaction. Since he's a bit of a pervert in the series, he would have to really adjust his behavior. He might also see this as an opportunity to study the differences in chakra and fighting styles between male and female ninjas while also trying to guide Naruto in this new form.
His friends' reactions would be mixed. Shikamaru would be like 'This is such a drag.' But he'd also start thinking of strategies to deal with the situation. Ino would be all about helping Naruto with his new look, like suggesting new outfits that would suit a fox girl. Choji would be more focused on making sure Naruto is still the same person inside. He'd offer Naruto his snacks to cheer him up. And Hinata would be blushing a lot, but also be very supportive, saying things like 'Naruto - kun, you look... different, but you're still you.'
In terms of the story's development, it could lead to a whole new arc. Naruto's transformation into a baby girl could be a sign of a greater threat to the ninja world. It might be related to some ancient curse or a new enemy's plot. And as he tries to figure out how to turn back, he would have to rely on his friends and his own inner strength in a different way than before.
Sakura might be really surprised at first. She could be a bit skeptical about whether it's really Naruto or some kind of trick. But then she would probably try to help him find a way to change back.
Stoick would be quite surprised and a bit worried. As a father, he'd take on the responsibility of caring for his baby son. He might be a bit clumsy at first, not used to dealing with a baby again. The other Vikings would have mixed reactions. Some might find it funny, while others would be more concerned about how to reverse the situation and get their leader back to normal.
Percy would probably be very protective. He'd be constantly worried about her safety and would do everything he could to keep her out of harm's way.