Apple Inc. (AAPL) saw its stock follow the Dow Jones Industrial Average (DJIA) downward on Tuesday as the market reacted to a slew of economic and corporate developments. The tech giant's shares dropped nearly 3% to hover around $220, driven by various factors including President Donald Trump's new tariff impositions and complications in the company's product development timeline. The U.S. President announced an additional 25% tariff on Canadian steel and aluminum imports, citing retaliatory measures against Ontario's electricity surcharge on American exports.
In tandem with broader market trends, the U.S. stock indices experienced moderate declines on Tuesday. This comes after more significant sell-offs occurred last Friday and this Monday. Bank of America Securities noted prevalent selling in single stock names, contributing to the overall market dip.
Impact of Tariffs and Market Conditions
President Trump's decision to impose higher tariffs on Canadian imports has added tension to U.S.-Canada trade relations. According to Trump, the tariffs were a response to Ontario's 25% surcharge on electricity exports to the U.S. The move has implications for industries reliant on Canadian steel and aluminum, with potential ripple effects across various sectors.
The U.S. Dollar faced pressure amid increasing recession fears, which further complicated the market landscape. Meanwhile, the EUR/USD pair traded at fresh multi-month highs above 1.0900 during the American session on Tuesday, reflecting broader currency market dynamics.
Amid these economic uncertainties, Apple is navigating its own set of challenges. The company reported a decline in its smartwatch segment, with sales dropping 19% year-over-year in 2024. Despite these setbacks, Apple management remains optimistic about a solid outlook for 2025, though uncertainties linger.
Apple’s Product Delays and Stock Performance
Apple's stock performance has been partly impacted by delays in its product development. The company postponed the upgrade timeline for its digital assistant, Siri, affecting iPhone shipments. Originally anticipated for release this spring, the significant update to Siri will now be deferred to next year.
“The expectation has been that the big update of Siri with on-screen awareness, personal context and deep app integration will be released sometime this April/May,” said the Citi team led by Atif Malik, “but Apple confirmed on March 7 that the company sees delay in these features and now expects to roll it out in the coming year, which we view as a negative as it would have been a catalyst to drive up higher refresh this year.”
Citi Research revised its forecast for iPhone shipments in 2025, now estimating shipments at 232 million units, which translates to a modest 2% annual growth. This adjustment reflects ongoing challenges in the smartphone market and potential impacts from delayed product advancements.
Despite the current downturn, Apple stock is not considered oversold, maintaining a Relative Strength Index (RSI) reading of 32. This indicates that while the stock is experiencing pressure, it has not yet reached extreme lows relative to its recent performance.
Broader Market Reactions
The broader market reactions have been influenced by both domestic policy changes and global economic factors. While U.S. stock indices trended lower on Tuesday, the declines were less severe compared to earlier sessions this week.
Much of the market's current volatility can be attributed to investor concerns over potential economic slowdowns and policy shifts. With growing recession fears and international trade tensions, investors remain cautious as they navigate a complex financial landscape.
Moreover, financial institutions like Bank of America Securities have observed increased selling in individual stock names, contributing to overall market fluctuations. These trends suggest that investors are reassessing their portfolios in light of evolving market conditions and corporate announcements.