Apple Inc. and other major technology companies tumbled in pre-market trading on Monday, as trade tensions between the U.S. and China escalated further.
China’s Ministry of Finance says the country would raise tariffs on some U.S. goods. The move came after President Donald Trump warned the country not to retaliate after the latest round of American measures.
Shares of Apple lost 3.5% before the bell, in the latest example of trade-related weakness. The iPhone maker dropped about 6.9% last week, its biggest weekly decline of 2019.
Apple has been closely correlated to trade-related headlines. Not only are its supply chain and production closely linked to China, but the Asian nation also accounted for nearly 20% of its 2018 revenue, according to data compiled by Bloomberg. Morgan Stanley last week estimated that in a worst-case trade scenario, Apple could see its earnings drop by nearly a quarter, or $3 per share.
Among other notable names, Microsoft Corp. fell 2.3% in pre-market while Qualcomm Inc. was off 2.7%. Major U.S. stock-market indexes were also lower.
An exchange-traded fund that tracks the semiconductor sector fell 3.1% before the bell. Among specific chipmakers, Texas Instruments Inc. was down 2.3%. Micron Technology Inc. shed 3.6%. Semiconductor stocks also suffered their worst week of the year last week, with trade issues a contributor to the losses.