Analysts described President Trump’s latest slate of tariffs Wednesday as “worse than the worst case scenario” for tech investors.
Trump announced a sweeping 10 percent tariff on goods from all foreign countries, alongside higher tariffs on nations deemed the “worst offenders” when it comes to trade barriers.
Tech firms, such as Apple, Nvidia and other chipmakers, could be particularly impacted by the hefty new tariffs on China and Taiwan, according to Wedbush Securities analysts. The administration announced a 34 percent tariff on Beijing and a 32 percent tariff on Taipei.
“Tech stocks will clearly be under major pressure on this announcement as the worries about demand destruction, supply chains, and especially the China/Taiwan piece of the tariffs,” the analysts wrote in a note Wednesday evening.
Apple produces most of its iPhones in China, and Nvidia and other chip companies have “significant exposure” to China and Taiwan supply chains, the analysts noted.
“For now the White House will say they are not looking for deals … but we continue to believe there are off ramps and major negotiations that will [happen] over the coming months with various countries and companies to navigate this new world of tariffs,” they added.
The White House emphasized Wednesday that the tariffs are not intended as a negotiation tactic and are needed to boost domestic manufacturing.
“We’re very focused on getting this tariff regime in place,” a senior White House official said. “This is not a negotiation, it’s a national emergency.”
Major tech stocks have already taken a beating this year, as wider market tumult has combined with growing uncertainty about the artificial intelligence boom. Nvidia’s stock has tumbled more than 20 percent since the start of the year, while Google is down more than 16 percent.
Amazon has fallen nearly 11 percent over the same period, and both Apple and Microsoft are down 8 percent. Meta, the parent company of Facebook and Instagram, has dipped about 2.5 percent.
Elon Musk’s Tesla, which has struggled in the face of the tech billionaire’s prominent role in the Trump administration, has seen its share price plummet 25 percent.
