'There’ll be A Transition Cost And Transition Problems,' Admits Trump Amid Tariff Woes, While Bessent Hints At Negotiation Deals - Apple (NASDAQ:AAPL), Advanced Micro Devices (NASDAQ:AMD)

President Donald Trump has warned of “transition problems” as the global tariff war rages on, causing markets to falter.

What Happened: Trump admitted the possibility of difficulties during a cabinet meeting. Despite the upheaval, he remained positive about the eventual outcome, saying, “There'll be a transition cost and transition problems, but in the end, it's going to be a beautiful thing,” reported CNBC.

"We're doing again, what we should have done many years ago," stated the President.

The President’s remarks followed the White House’s announcement that tariffs on certain Chinese goods would skyrocket to 145%. This is on top of an existing 20% tariff on fentanyl producers. Despite the escalating trade war, Trump is still hopeful for a deal with China.

Meanwhile, the stock market had another volatile day on Thursday, with substantial losses across the S&P 500, Dow Jones, and Nasdaq.

Despite the market chaos, U.S. Treasury Secretary Scott Bessent tried to calm fears, stating that over 75 countries were keen to start trade negotiations. Commerce Secretary Howard Lutnick echoed this sentiment, asserting, “We’re getting the respect we deserve now.” When asked about the stock market turmoil on Thursday, Bessent spoke about the good inflation number and oil prices going down and stated, “I don’t think I see anything unusual today.”

Why It Matters: Trump’s warning of “transition problems” echoes his comments in March about a potential “period of transition” for the economy. This comes amid fears of a possible recession and significant changes to the economy, including tariffs and federal workforce reductions. For investors, the immediate concern is whether the market's recent volatility is a precursor to further declines or a sign of a potential reset.

The President’s recent announcement of a 90-day pause and a reduced Reciprocal Tariff of 10% marked a significant shift from his previous stance. However, the escalating trade war and its impact on the stock market have raised concerns among investors and analysts.

Jake Schurmeier, portfolio manager at Harbor Capital, stated that even though the pause is encouraging, it doesn't resolve the ongoing uncertainty. "We likely go higher for a few days, but I think permanent damage has been done.” In the Investment Committee debate on CNBC, analysts argue that without a defined plan, corporate guidance and investor confidence will remain weak.

Tech stocks slumped after a sharp rally, as markets reassessed the impact of Trump's new China tariffs. Tech stocks, Meta Platforms META, dropped 6.74%, while Nvidia Corp NVDA and Apple Inc. AAPL fell 5.9% and 4.24%, respectively. Meanwhile, chip stocks, Advanced Micro Devices Inc. AMD and Intel Corp INTC tumbled 8.4% and 7.6%, respectively.