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Key Takeaways
- The Magnificent Seven stocks fell all after Trump announced sweeping tariffs on Wednesday evening.
- Apple shares have dropped the most. It has a significant manufacturing presence in China. China was hit with a import tax of 34%.
- Analysts at JPMorgan estimate that the iPhone maker will have to increase its prices by 6% just to offset the tariff.
The Magnificent Seven stocks all tumbled Thursday in the wake of the Trump administration’s sweeping reciprocal tariffs—with Apple (AAPL) faring worst of all.
Apple’s shares dropped by 9% this morning after President Donald Trump, late Wednesday, imposed a 34% tax on China where Apple manufactures 90% of its products. Apple could face further problems if China imposes retaliatory duties.
Analysts at JPMorgan wrote about Apple on Thursday that the magnitude of the tariffs was much higher and wider than expected. They wrote that “price increases will be more modest than modest” to offset the headwinds.
Analysts estimate that Apple will have to increase its prices by 6% if they are not given an exemption.
Apple was exempted in 2018 from tariffs imposed on it by the first Trump administration. Analysts at Jefferies expect that Apple will be given a carveout once again. Analysts said that Apple’s announcement in February of its plans to invest over $500 billion in the U.S. in the next four years helped in Apple’s case.
Apple’s Magnificent 7 peers also declined. Amazon (AMZN), Nvidia (NVDA), Meta, and Tesla (TSLA), all of which fell by around 6% each, also saw a decline in their shares. Alphabet’s (GOOGL) shares and Microsoft’s (MSFT) fell by 4% and respectively 3%. (Read Investopedia’s live coverage of the markets today here.)
The Roundhill Magnificent seven ETF (MAGS), a fund that tracks the group’s performance, lost over 10% of its value in march. All seven companies are in the red this year.
