Shares in major U.S. companies, such as Apple, Amazon, and Tesla, experienced declines in after-hours trading on Wednesday. The declines occurred as a result of the broad tariff measures introduced by Donald Trump, which posed significant threats to global supply chains.
Technology companies were particularly affected by the market’s initial reaction, with contracts tracking the Nasdaq falling by 4 percent. Apple, facing substantial exposure to additional tariffs on China, witnessed its shares drop by 7 percent, while Amazon’s shares decreased by approximately 6 percent.
The escalation of Trump’s global trade conflict introduces considerable risks to technology supply chains. This follows months of efforts by top executives to persuade the president to either soften or exempt their companies from policies that could adversely affect their financial performance.
Beyond the tech sector, shares of major retailers and consumer brands also fell following Trump’s tariff announcement. Walmart saw a 7 percent decline, Target fell more than 5 percent, and Nike’s shares dropped by 7 percent during after-hours trading.
A universal 10 percent tariff on all countries will be implemented as of midnight eastern time on April 5. Higher “reciprocal” tariffs, affecting regions such as the EU, China, the UK, Japan, and South Korea, will take effect from midnight eastern time on April 9.
Wedbush analyst Daniel Ives noted that the wave of new tariffs surpassed the most severe scenario anticipated by the markets. He commented that tech stocks would be under significant pressure due to concerns about demand reduction, supply chains, and particularly the implications for China and Taiwan.
An executive from a major tech firm described operating under the current administration as trying to hit a moving target, expressing greater concern over potential damage to the U.S. economy than any specific set of tariffs.
Apple did not comment on the possibility of obtaining exemptions from the new tariffs, similar to what occurred during Trump’s first term. However, a White House spokesperson verified that there were no exemptions for Apple under the president’s executive order.
Apple CEO Tim Cook is faced with a geopolitical challenge, given the company’s supply chains are closely tied to China, where Foxconn and others manufacture millions of iPhones annually. In February, a $500 billion spending plan was seen as an effort to appease Trump.
Apple annually ships about 50 million iPhones to the U.S., with most being manufactured in China. The iPhone, representing more than half of Apple’s total revenue, remains the company’s flagship product, while other product lines such as Mac, iPad, wearables, and its services business contribute to the rest.
Trump also announced a “reciprocal” 34 percent tariff on Chinese imports, in addition to a 20 percent tariff already in place. Tariffs of 26 percent on India and 46 percent on Vietnam, where Apple also produces goods, were also announced.
This unilateral action, impacting multiple key manufacturing countries, would affect Apple’s vital supply chain relationship with China and reduce benefits from efforts to diversify its manufacturing bases.
Amazon has also recently engaged in efforts to sway Trump, having faced criticism from the president during his first term. Jeff Bezos, the company’s founder, attended Trump’s inauguration and met several times with him recently.
The Seattle-based corporation relies heavily on Chinese imports to fill its warehouses, and around one-fourth of its retail operation’s costs are linked to China, according to Morgan Stanley analysts.
Nvidia’s shares dropped by more than 5 percent after-hours, despite the White House clarifying that semiconductors are, for now, excluded from the reciprocal tariff regime.
The chip manufacturer depends on Taiwan Semiconductor Manufacturing Co. for the production of its advanced AI chips, which have significantly contributed to the company’s high valuations over the past two years.
Nvidia, whose CEO Jensen Huang has similarly committed billions in U.S. spending over the upcoming years as discussed in a Financial Times interview, declined to comment on the developments.
Shares of TSMC fell about 6 percent during after-hours trading. Recently, the company pledged an additional $100 billion investment in U.S. chip manufacturing.
Meta’s shares dropped by approximately 5 percent. The company had previously cautioned that its advertising revenues from China could be negatively impacted should a trade dispute with the U.S. escalate.
Trump also confirmed the imposition of 25 percent tariffs on all foreign-made cars and parts starting at midnight, affecting stocks of all U.S. automobile manufacturers.
Tesla’s shares fell by 8 percent in after-hours trading as investors expressed concerns about the impact on its global supply chain and the potential for retaliatory tariffs against the world’s largest electric vehicle producer.
Last month, Tesla warned that car production costs might increase due to the difficulty or impossibility of sourcing certain parts and components within the U.S., making American vehicles less competitive in the global market.
A White House factsheet indicated that some items, such as cars and parts already subject to tariffs, copper, and specific minerals not found in the U.S., would be exempt, although further details were not provided.
Daniel Newman, CEO of The Futurum Group, described Trump’s move as a “rip the Band-Aid-off moment” for tech investors who had been anxious for weeks.
For retailers, the share declines occurred despite efforts over recent years to diversify supply chains following Trump’s imposition of steep tariffs on Chinese imports during his first term. Home Depot, the largest home improvement chain, had suppliers move some production to Southeast Asia, Mexico, and the U.S., according to CEO Ted Decker last month.
Target had shifted production of apparel out of China, focusing more on Central American countries like Guatemala and Honduras, stated Rick Gomez, the chief commercial officer, last month. However, Trump imposed 10 percent tariffs on Guatemala and Honduras on Wednesday. Target declined to comment.
Michael Hanson, senior executive vice-president at the Retail Industry Leaders Association, which includes Target, remarked that the newly announced tariffs, coupled with anticipated retaliatory measures against American businesses, jeopardize the U.S. economy’s stability and undermine the goals of boosting domestic manufacturing and growth.
The introduction of the new tariffs immediately prompted a push for relief measures. The Consumer Brands Association, which has members including food manufacturers like PepsiCo, Mondelez, and Kraft Heinz, petitioned for certain “critical ingredients” to be exempted from the levies.
The association encouraged President Trump and his trade advisers to refine their approach, advocating for the exclusion of key ingredients and inputs to safeguard manufacturing jobs and prevent unnecessary inflation in grocery stores.
