Apple: China, U.S. Fight Hurts iPhone Maker
Apple’s stock suffered high selling pressure at the fourth trading session of the week. It has lost over a fifth of its value in the past month.. Wall Street analysts warned that the iPhone maker faces challenges amid Trump’s tariffs on China.
The market action shows the stock has lost the bullish grip to hold the $190 support line and faces more downward pressure at the $180 sub-levels amid less appetite for risk in the global financial space
Analysts claim that due to its heavy reliance on China, which is subject to high tariffs, the iPhone maker lost its place as the world’s most valuable company to President Trump’s comprehensive plan, which also includes higher tariffs on goods from Asia amid manufacturing in Vietnam, Thailand, and India.
Erik Woodring, an analyst at Morgan Stanley, stated that Apple still faces significant short-term challenges. According to his client note, the Trump tariffs on China, where Apple produces MOST of its iPhones, risk making Apple’s stock more susceptible to declines.
However, Woodring highlighted several ways the phone maker could mitigate such risk. The strategies include raising the price of iPhones in the U.S. and increasing production in India.
The new tariffs mean Apple will likely have to raise prices or absorb additional tariff costs. Apple’s most expensive iPhone, currently $1,199, could rise by about $350, or roughly 30%, according to UBS analysts.
Tim Long, an analyst at Barclays, suggests that Apple should raise its prices or face a 15% decline in earnings.
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