Apple stock drops after Trump admin says it will increase Chinese tariff to 104%

Apple (AAPL) banal fell connected Tuesday, reversing earlier gains aft the Trump medication confirmed the US volition institute a levy of 104% connected goods imported from China, effectual Wednesday.

Apple shares were already reeling from Trump's archetypal 54% duty, arsenic Wall Street considered however the institution would navigate the tariffs. And aft a little reprieve Tuesday morning, those anxieties rapidly returned successful day trading.

Apple initially climbed arsenic precocious arsenic $190.34 aft opening astatine $186.73. But investors began dropping retired pursuing the tariff conformation alongside a broader marketplace sell-off.

President Trump had said helium would use a 34% tariff connected apical of an existing 20% taxation connected Chinese goods during his "Liberation Day" property lawsuit connected April 2, bringing the full tariff to 54%. In a station connected Truth Social connected Monday, Trump said helium would adhd an further 50% tariff connected April 9, if China didn't retreat its 34% taxation by Tuesday.

Apple builds the bulk of its iPhones successful China, contempt an effort to determination much manufacturing to India. Trump has besides placed a 26% tariff connected goods from that state arsenic well.

Baird Equity Research expert William Power was already projecting the imaginable for Apple's gross margins to driblet from 46.8% to 44.4% successful 2025 and to 41.6% successful 2026 nether Trump's anterior tariff plan, and the further levy is bound to person a greater impact.

Its unclear however Apple volition woody with the increase. The institution antecedently won an exemption from tariffs during Trump's archetypal term, but there's nary warrant it volition beryllium palmy this clip around.

During a property briefing connected Tuesday White House Press Secretary Karoline Leavitt said Trump, "believes we person the labor, we person the workforce, we person the resources," to bring iPhone manufacturing to the US.

But according to Wedbush's Dan Ives, doing truthful would instrumentality years and origin iPhone prices to skyrocket.

"The world is it would instrumentality 3 years and $30 cardinal successful our estimation to determination adjacent 10% of [Apple's] proviso concatenation from Asia to the US with large disruption successful the process," Ives wrote successful an April 3 capitalist note.

"If consumers privation a $3,500 iPhone we should marque them successful New Jersey oregon Texas oregon different authorities ... The conception of making iPhones successful the US is simply a non-starter successful our presumption astatine $1,000. Price points would determination up truthful dramatically it's hard to comprehend and the near-term borderline interaction connected Apple's gross margins during this tariff warfare could beryllium caput boggling for this US tech stalwart."