Apple suffers biggest one-day drop in 5 years as Trump's tariffs trigger $300 billion sell-off

Core Viewpoint - Apple experienced its largest one-day stock drop in five years, approximately 9%, due to investor panic over Donald Trump's new tariffs, which could significantly impact the company's supply chain and overall profitability [1][3]. Group 1: Tariff Impact - Trump's tariffs include a 34% additional tariff on China, which is crucial for Apple's manufacturing and assembly operations [2]. - The effective tariff rate on China is projected to be 54%, raising concerns about increased import costs for Apple [1]. - Apple's attempts to diversify its supply chain away from China have been undermined by these tariffs, affecting growth in regions like India, Thailand, Malaysia, and Vietnam [2]. Group 2: Financial Consequences - Apple's market capitalization fell to $3 trillion, erasing nearly nine months of gains due to the tariff news [3]. - Analysts predict that Apple may need to raise hardware prices by about 30% to offset the tariff impact on earnings per share [4]. - If Apple does not raise prices, it could face a significant decline in profit margins, which are highly valued by investors [5]. Group 3: Broader Market Reaction - The overall tech sector was negatively affected, with Nvidia and Tesla shares dropping by approximately 7.8% and 5.5%, respectively [5]. - The Dow Jones Index and S&P 500 also saw declines of nearly 4% and over 4.8%, respectively, reflecting widespread market concern [5].