Shares of Apple and semiconductor stocks took a notable hit after US President Donald Trump said in a tweet last Friday that American companies should “immediately start looking for an alternative” to their operations in China, a comment that should concern many Silicons Valley companies that manufacture their consumer electronics products in China.
Shares of Apple ended the day down 4.6 percent, Qualcomm slid 4.7 percent, Nvidia lost 5.2 percent, Advanced Micro Devices dropped 7.4 percent, Micron fell roughly four percent and Broadcom slid 5.3 percent, CNBC reported.
The comment affected the tech-heavy Nasdaq, which was down 2.6 percent. Meanwhile, the Dow Jones Industrial Average slid 2. percent and the S&P 500 fell 2.5 percent.
The presidential tweet reads as follows:
Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing … your companies HOME and making your products in the USA.
It’s unclear how the US president could “order” US firms where they produce goods.
….better off without them. The vast amounts of money made and stolen by China from the United States, year after year, for decades, will and must STOP. Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing..
— Donald J. Trump (@realDonaldTrump) August 23, 2019
The escalating trade war between the United States and China could affect Apple’s global competitiveness, CEO Tim Cook told Trump. Starting in a few weeks, the US will impose duties on $300 billion worth of China’s goods. In retaliation, the 1.4 billion people country plans to levy tariffs on $75 billion more of US goods, including cars.
Trump’s tweet storm also accuses China of stealing intellectual property from the US.
Here’s that tweet in its original form, without any edits for clarity:
Our Country has lost, stupidly, Trillions of Dollars with China over many years. They have stolen our Intellectual Property at a rate of Hundreds of Billions of Dollars a year, & they want to continue. I won’t let that happen! We don’t need China and, frankly, would be far better off without them. The vast amounts of money made and stolen by China from the United States, year after year, for decades, will and must STOP.
Trump last week said he likes Tim Cook, calling the Apple CEO “a great executive” because Cook calls him directly whenever there’s a problem, which the US president said isn’t true for other Silicon Valley technology CEOs.
“That’s why he’s a great executive,” Trump told reporters last Wednesday from outside the White House. “Because he calls me and others don’t. Others go out and hire very expensive consultants. Tim Cook calls Donald Trump directly,” as detailed by CNBC.