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Apple shares fall as Trump says make phone here

China Daily | Updated: 2018-09-11 22:31

Apple Inc shares declined on Monday after US President Donald Trump told the iPhone maker it should move production to America from China to avoid his upcoming tariffs.

Apple fell 1.34 percent to $218.33 in Nasdaq market trading the day before CEO Tim Cook was expected to unveil new iPhones and product updates.

Trump said on Friday he was considering extending penalties to an additional $267 billion of Chinese products. That would be on top of $50 billion of goods already hit by 25 percent duties and another $200 billion on which Washington is poised to raise tariffs.

China will respond if the United States takes any new steps on trade, the Foreign Ministry said on Monday.

On Saturday, Trump followed up with a tweet aimed at Apple:

"Apple prices may increase because of the massive Tariffs we may be imposing on China — but there is an easy solution where there would be ZERO tax, and indeed a tax incentive. Make your products in the United States instead of China. Start building new plants now. Exciting!"

Apple did not respond to Trump's tweet.

Moving production from China to the US could mean that the price of Apple's iPhones could rise as much as 20 percent, according to Bank of America Merrill Lynch analyst Wamsi Mohan

Mohan said that Apple may give in to Trump's request by asking its partners to bring some iPhone assembly operations into the US, which will lead to the higher prices.

On Friday, Apple filed a letter with US officials, saying Trump's proposed tariffs on $200 billion worth of imported Chinese goods would affect the Apple Watch, AirPods, Mac Minis and Apple Pencils.

Bloomberg said that Apple is expected to unveil three new iPhones at its headquarters in Cupertino, California, on Wednesday. None of the phones will feature new breakthrough features, with more significant changes planned for next year, according to Bloomberg.

Apple, Amazon.com and Google parent Alphabet were among the biggest losers in the Nasdaq 100 Index on Monday.

The S&P 500 broke a four-day slide, bolstered by increases in Microsoft and Home Depot, while the Dow Jones Industrial Average fell for a second day.

Equities sank in Shanghai and Hong Kong, with the latter's benchmark nearing a bear market in the wake of Trump's threat to step up his trade showdown with China.

"We've had so much data come through that we now get into a little bit of a lull," Mark Hackett, chief of investment research at Nationwide Funds Group, said in an interview at Bloomberg's New York headquarters. "So unfortunately the only thing that is left is trade, and we're going to probably get more negative headlines on that than positive."

Bloomberg contributed to this story.

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