Apple Shares Drop As Trump's 104% China Tariff Escalation Sparks Market Reversal: What's Going On?

Apple Inc. AAPL shares are trading lower Tuesday as markets turned negative following confirmation from the White House that President Donald Trump's 104% retaliatory tariff on Chinese imports will take effect Wednesday.

What To Know: The announcement came from White House Press Secretary Karoline Leavitt, who stated the administration would move forward with the full tariff package without delay or exemption. She emphasized the tariffs are a direct response to Chinese retaliation and are aimed at generating trillions in revenue while encouraging domestic production and reducing trade deficits.

The market, which had opened strong, reversed sharply following the announcement. The S&P 500, which was in the green earlier, slipped 0.3%, while the Russell 2000 dropped 1.3%. The Nasdaq 100 held on to a narrow 0.1% gain, with momentum continuing to fade in afternoon trading.

Apple shares declined as concerns grew over how the company's supply chain and sales in China could be affected by the worsening trade environment. The tech sector, which initially led gains earlier in the session, also saw losses across major names. Tesla, Amazon and Apple all traded lower, with only Nvidia holding onto gains.

Federal Reserve officials also weighed in on the situation. Chicago Fed President Austan Goolsbee warned the economic drag from tariffs could be forming faster than data can capture. He called for quicker assessments of investment and GDP activity to track real-time impacts of protectionist measures.

With no indication of de-escalation and a midnight deadline for the tariffs to take effect, investors pulled back from risk and shifted focus to defensive sectors. Materials and consumer discretionary stocks led sector losses, reflecting concern over global trade disruption.

AAPL Price Action: Apple shares were down 6.59% at $169.50 at time of publication Tuesday, according to Benzinga Pro.

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