Gold bars to be exempt from tariffs, White House clarifies
Investing.com-- Wall Street’s so-called Magnificent Seven stocks slumped in aftermarket trade on Wednesday, with Apple (NASDAQ:AAPL) and Tesla (NASDAQ:TSLA) among the biggest decliners after President Donald Trump announced a swathe of steep trade tariffs.
Apple was the worst performer among its peers, losing about 6.7% in aftermarket trade, while Tesla shed about 6% by 20:19 ET (00:19 GMT). Amazon.com (NASDAQ:AMZN) fell 5.5%, Microsoft (NASDAQ:MSFT) and Alphabet (NASDAQ:GOOGL) shed about 2.5% each, while Meta (NASDAQ:META) lost about 4%.
Market darling Nvidia (NASDAQ:NVDA) fell 4.4%.
Trump announced a 10% universal tariff on U.S. imports, and also announced reciprocal tariffs against major trading partners equivalent to half their duties on U.S. goods.
The tariffs were aimed largely at countries with high trade surpluses with the U.S., as well as those with high import taxes on U.S. goods.
China was the worst hit by the new tariffs, with total U.S. tariffs against the country now coming up to 54%.
This was a major point of contention for Wall Street, given that China plays a major role in the global manufacturing supply chain.
Apple, which produces several products through its Chinese partners, is likely to be severely impacted by the tariffs. Trump imposed steep tariffs on Taiwan, Japan, and South Korea, which are also part of Apple’s supply chain.
Tesla sank on concerns that retaliation against Trump’s tariffs could impact the electric vehicle maker’s foreign sales, which are already under pressure.
While Tesla manufactures all of its U.S.-sold cars locally, it still sources several key components from other countries, mainly China. CEO Elon Musk had recently said that Trump’s tariffs would significantly impact the company.
Other major Wall Street stocks were caught up in broad-based risk aversion over Trump’s tariffs, with U.S. stock index futures also falling sharply on Wednesday evening.
Analysts said that Trump’s tariffs were far worse than anticipated, and increased the risk of a U.S. and global recession.
Trump’s tariffs will be borne by U.S. importers, who could pass on costs to consumers and spur higher inflation in the coming months. The tariffs are also expected to cause mass disruption in global trade channels, which could further undermine growth.
Still, Trump provided exceptions for copper, pharmaceuticals, lumber, gold, energy, and some critical minerals. Trump’s tariffs will take effect in the coming week.