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The Trump administration has spared a set of high-tech products that include Apple, Inc. (AAPL - Free Report) Apple Watch and AirPods headphone from the latest round of tariffs, per Bloomberg. On Sep 17, Trump announced tariffs of 10% on $200 billion worth of Chinese goods in a statement that is likely to take effect on Sep 24. However, Apple’s shares still plummeted 2.7% on Monday.
It’s not only Apple but other tech majors too took a hit after the announcement of fresh tariffs. Tech stocks have been reeling under pressure for quite some time, particularly those that have significant exposure to China and generate substantial portion of their revenues from that country. In fact, a few tech players, including Apple, had earlier this month stated that another round of tariffs could hurt them.
Will Apple Escape Tariff Troubles?
Apparently, yes. Per Bloomberg, Apple’s Apple Watch and AirPods headphone have been spared the latest round of tariffs imposed by the Trump administration, according to the office of the U.S. Trade Representative. The 10% tariff on $200 billion worth of Chinese goods is likely to come into effect on Sep 24. Also, similar smart watches like competitor Fitbit, Inc. are not on the list. However, both Apple and Fitbit’s shares plummeted on Monday. Shares of Fitbit declined 1.1%.
Moreover, smart watches that use Bluetooth wireless communications, the technology used in Apple Watch and AirPods, too might be exemptedfrom the latest round of tariffs. In fact, the Trump administration had removed proposals on flat-panel television sets from the first round of tariffs on $50 billion worth of Chinese goods in June.
Earlier this month, Apple had said that some of its products, including Apple Watch, would be affected if another round of tariffs is imposed. This saw shares of Apple declining for most of last week. In response, Trump tweeted that there’s an easy way of avoiding tariffs for Apple and that isby shifting its production to the United States. Apple has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Per International Data Corp,Apple sold 4.7 billion smart watches in 2017, while Fitbit sold 2.7 billion. Apple does a bulk of its manufacturing in China via contract manufacturers. Hence higher tariffs mean importing its products to the United States at a higher cost. This could make Apple shift production to the United States and other markets.
It is now to be seen how China retaliates. China is one of the biggest markets for Apple. The company shipped more than 41 million iPhones to China in 2017, generating around 20% of its total revenues. China could make things difficult for Apple if the trade war escalates via taxes and regulatory measures.
What’s in Store for Other Tech Companies?
Apple isn’t the only tech major worried about tariffs. Earlier this month, a number of big tech companies like Dell Technologies Inc. , Cisco Systems, Inc. (CSCO - Free Report) and Hewlett Packard Enterprise Company (HPE - Free Report) had requested U.S. Trade Representative Robert Lighthizer to reconsider White House’s plan of imposing tariffs of up to 25% on Chinese imports as it would affect their business.
On Monday, shares of Cisco Systems, Dell and Hewlett Packard declined 0.6%, 1.4% and 1.8%, respectively. According to a recent report by Morgan Stanley (MS - Free Report) , tit-for-tat tariffs would have an increasingly detrimental effect on the global supply chain. Tech companies with significant exposure to China have been reeling since Trump announced tariffs in early March.
This includes a number of chipmakerslike Skyworks Solutions, Inc. (SWKS - Free Report) , Qualcomm, Inc. (QCOM - Free Report) , Broadcom, Inc. (AVGO - Free Report) and Micron Technology, Inc. (MU - Free Report) , which generate maximum revenues from China. Shares of Skyworks Solutions, Qualcomm, Broadcom and Micron declined 1.7%, 2.5%, 0.7% and 1.6%, respectively, on Sep 17. Tech companies, particularly chipmakers, will now be waiting to seehow China retaliates to these tariffs.
5 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2018 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs. A bonus Zacks Special Report names this breakthrough and the 5 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains.
Image: Bigstock
Can Tech Majors Survive Trump's Tariffs?
The Trump administration has spared a set of high-tech products that include Apple, Inc. (AAPL - Free Report) Apple Watch and AirPods headphone from the latest round of tariffs, per Bloomberg. On Sep 17, Trump announced tariffs of 10% on $200 billion worth of Chinese goods in a statement that is likely to take effect on Sep 24. However, Apple’s shares still plummeted 2.7% on Monday.
It’s not only Apple but other tech majors too took a hit after the announcement of fresh tariffs. Tech stocks have been reeling under pressure for quite some time, particularly those that have significant exposure to China and generate substantial portion of their revenues from that country. In fact, a few tech players, including Apple, had earlier this month stated that another round of tariffs could hurt them.
Will Apple Escape Tariff Troubles?
Apparently, yes. Per Bloomberg, Apple’s Apple Watch and AirPods headphone have been spared the latest round of tariffs imposed by the Trump administration, according to the office of the U.S. Trade Representative. The 10% tariff on $200 billion worth of Chinese goods is likely to come into effect on Sep 24. Also, similar smart watches like competitor Fitbit, Inc. are not on the list. However, both Apple and Fitbit’s shares plummeted on Monday. Shares of Fitbit declined 1.1%.
Moreover, smart watches that use Bluetooth wireless communications, the technology used in Apple Watch and AirPods, too might be exemptedfrom the latest round of tariffs. In fact, the Trump administration had removed proposals on flat-panel television sets from the first round of tariffs on $50 billion worth of Chinese goods in June.
Earlier this month, Apple had said that some of its products, including Apple Watch, would be affected if another round of tariffs is imposed. This saw shares of Apple declining for most of last week. In response, Trump tweeted that there’s an easy way of avoiding tariffs for Apple and that isby shifting its production to the United States. Apple has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Per International Data Corp,Apple sold 4.7 billion smart watches in 2017, while Fitbit sold 2.7 billion. Apple does a bulk of its manufacturing in China via contract manufacturers. Hence higher tariffs mean importing its products to the United States at a higher cost. This could make Apple shift production to the United States and other markets.
It is now to be seen how China retaliates. China is one of the biggest markets for Apple. The company shipped more than 41 million iPhones to China in 2017, generating around 20% of its total revenues. China could make things difficult for Apple if the trade war escalates via taxes and regulatory measures.
What’s in Store for Other Tech Companies?
Apple isn’t the only tech major worried about tariffs. Earlier this month, a number of big tech companies like Dell Technologies Inc. , Cisco Systems, Inc. (CSCO - Free Report) and Hewlett Packard Enterprise Company (HPE - Free Report) had requested U.S. Trade Representative Robert Lighthizer to reconsider White House’s plan of imposing tariffs of up to 25% on Chinese imports as it would affect their business.
On Monday, shares of Cisco Systems, Dell and Hewlett Packard declined 0.6%, 1.4% and 1.8%, respectively. According to a recent report by Morgan Stanley (MS - Free Report) , tit-for-tat tariffs would have an increasingly detrimental effect on the global supply chain. Tech companies with significant exposure to China have been reeling since Trump announced tariffs in early March.
This includes a number of chipmakerslike Skyworks Solutions, Inc. (SWKS - Free Report) , Qualcomm, Inc. (QCOM - Free Report) , Broadcom, Inc. (AVGO - Free Report) and Micron Technology, Inc. (MU - Free Report) , which generate maximum revenues from China. Shares of Skyworks Solutions, Qualcomm, Broadcom and Micron declined 1.7%, 2.5%, 0.7% and 1.6%, respectively, on Sep 17. Tech companies, particularly chipmakers, will now be waiting to seehow China retaliates to these tariffs.
5 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2018 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs. A bonus Zacks Special Report names this breakthrough and the 5 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains.
Click to see them right now >>