What Happened?
Shares of iPhone and iPad maker Apple (NASDAQ: AAPL) jumped 2.2% in the morning session after reports indicated that smartphones, computers, and a wide range of tech devices and components would be exempt from the reciprocal tariffs on U.S. imports announced on April 2, 2025. The list of spared goods includes chips, solar panels, flat-screen TVs, flash drives, and memory cards.
However, President Trump added that the break might not last. He suggested new tariffs on devices like iPhones and tablets could come "very soon." This hinted that some tech and chip firms might still face some strain.
In a post on Truth Social, Trump also emphasized that these products remained "subject to the existing 20% Fentanyl Tariffs" and were merely being shifted to a different tariff category. Commerce Secretary Howard Lutnick echoed this sentiment, noting that the current exemptions were not permanent.
Though when asked specifically about tariffs on iPhones, President Trump offered a somewhat imprecise response: "There'll be maybe things coming up... I don't want to hurt anybody, but the end result is we're going to get to the position of greatness for our country."
Despite the unclear outlook, the market reaction suggested investors viewed the temporary exemption as a short-term relief as it was likely to provide affected companies a brief window to adjust their operations and mitigate potential impacts on their businesses.
The shares closed the day at $202.59, up 2.3% from previous close.
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What The Market Is Telling Us
Apple’s shares are very volatile and have had 29 moves greater than 2.5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 5 days ago when the stock gained 4.8% as markets rallied sharply on news that President Trump announced a 90-day tariff pause. Reciprocal tariffs were also dropped to 10% for most countries, sparking renewed optimism amid ongoing trade talks.
The major stock indices rose as investors, growing impatient of seemingly irrational tariff actions, welcomed the pause as a sign of a more measured path forward. However, Trump was quick to note that China was not part of the pause. Instead, he prepared to raise tariffs on Chinese goods to 125% after China announced retaliatory tariffs on US imports. This tough stance on China stood in sharp contrast to the softer tone toward others. In a week marked by growing uncertainty, this news eased some of the pressure. The questions remain whether we are out of the woods and can sustain the rally or not.
Apple is down 17.2% since the beginning of the year, and at $201.80 per share, it is trading 22.1% below its 52-week high of $259.02 from December 2024. Investors who bought $1,000 worth of Apple’s shares 5 years ago would now be looking at an investment worth $2,812.
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