Apple Falls 7% After Shock Tariffs on Asia Supply Chain

Apple shares dropped 7% after President Trump unveiled steep new tariffs—34% on China, 20% on the EU, 32% on Taiwan, 24% on Japan, and 46% on Vietnam—shocking tech investors and threatening global supply chains. Wall Street futures slid about 3%, the Nikkei followed with a similar drop, and European futures declined 1.7%, while Treasury yields and the dollar index hit multi-month lows. Analysts warn of higher recession risks despite inflationary pressures, with Fed futures now pricing in 80 basis points of rate cuts by year-end.

Equities

The FTSE 100 slipped 0.3% on Wednesday as investors turned cautious ahead of Donald Trump’s widely anticipated tariff announcement. Strength in the pound weighed on the export-heavy index, while a weaker dollar reflected broader uncertainty. The FTSE 250 rose 0.3%, supported by strong gains among select consumer and defence stocks.

AstraZeneca dropped 1.2%, leading losses on the FTSE 100, as healthcare shares moved lower across Europe ahead of new trade measures. The pharma and biotech index closed at its lowest in nearly a month. Rolls Royce declined 3%, while BAE Systems fell nearly 1% as defence stocks were among the hardest hit. Among midcaps, Bakkavor jumped 7.9% after rival Greencore agreed to acquire the food manufacturer in a £1.2 billion deal. Ocado rose 5.5%, and Chemring climbed almost 3% after securing a £251 million missile contract from the Ministry of Defence.

Across the Atlantic, US markets closed higher before Trump’s speech, with the Dow up 0.56% to 42,225.32, the S&P 500 gaining 0.67% to 5,670.97, and the Nasdaq climbing 0.87% to 17,601.05. However, after-hours futures turned sharply lower as Trump confirmed a 10% baseline tariff on all imports and higher duties for major trade partners, sending S&P 500 futures down 1.6% and Nasdaq futures off 2.4%.

Tesla rose 5.3% during the session after Politico reported that Elon Musk is likely to step back from a government role, which helped offset earlier pressure from a 13% drop in Q1 deliveries. Tesla shares fell again after the market closed, reacting to Trump’s speech. Amazon gained 2% following reports the company is bidding for short-form video platform TikTok, renewing speculation around its media strategy.

Among newly listed stocks, CoreWeave surged 16.7% as the AI-focused company extended gains from the previous session. In contrast, Newsmax slumped 77.5%, pulling back sharply after triple-digit percentage increases in its first two trading days.

Forex & Commodities

The US dollar fell sharply following President Trump’s announcement of a 10% baseline tariff on all imports, with higher duties targeting around 60 countries. The move triggered a shift into traditional safe-haven assets. The dollar index slipped to 102.98—its lowest level since October—while Treasury yields fell 15 basis points to 4.04%, a five-month low. Markets priced in a greater likelihood of rate cuts as concerns mounted over a slowdown in US growth.

Sterling gained 0.66% to $1.3097, its strongest level in five months, while the euro rose nearly 1% to $1.0950. In Asia, the yen strengthened 1.3% to 147.39 per dollar and the Swiss franc climbed to a four-month high at 0.8754 per dollar. The Chinese yuan dropped to a two-month low, and the Vietnamese dong hit a record low. The Australian and New Zealand dollars also declined.

Gold surged to a record high of $3,167.57 per ounce before settling at $3,132.69. Analysts pointed to expectations of US rate cuts and increased central bank demand as supporting factors. US gold futures eased to $3,155.00. Silver fell 2.6% to $33.13, platinum dropped 1.6% to $968.24, and palladium lost 1.4% to $956.50.

Oil fell by as much as 3%, with Brent at $72.98 and WTI at $69.70, as investors anticipated weaker demand. The White House confirmed that tariffs would exclude oil, gas, and refined products. US crude inventories rose by 6.2 million barrels last week, well above expectations for a decline.