This was an early manifestation of the tariff turmoil. Investors once piled into large technology companies after the government launched a temporary exemption covering consumer electronics, network equipment, GPUs and servers.
This is actually saying that large technology companies may be safe because investors also view the industry as a defensive investment. Meanwhile, other industries and companies are still facing large-scale tariff fluctuations
A feature of American politics is to avoid a situation where there is a winner in the market. This phrase is often used to attack opponents as bad for the economy.
But one person’s favoritism may be another person’s industrial policy.
If the market is engulfed by the negative impact of tariffs, then the exemption of these taxes may mean everything. However, the potential special exemption for technology stocks initially triggered a rally on Monday, which then faded and eventually rebounded. The confused reaction of investors is partly due to the mixed signals that the White House seems to be sending.
After the reciprocal tariff exemption was first announced, the president said on social media that “no tariff “exceptions” were announced.” He later told reporters that his goal is to encourage production to move to the United States, but also added that the government must show flexibility.
Tech giants hoping for White House aid have also shown flexibility, or rather, willingness to support the president’s agenda to bolster domestic manufacturing and investment.
Nvidia (NVDA) announced Monday that it will invest up to $500 billion in AI infrastructure in the U.S. over the next four years. That follows pledges by other tech giants, including Apple (AAPL), Microsoft (MSFT) and Meta (META).
The sharp gains in recent sessions have made one thing clear: The tariff announcement is the only meaningful catalyst for the stock market in this uncertain moment.
The same is true for big tech companies, whose trillion-dollar tickers are supported by supply chains and customer bases that span the globe. Granted, their size and market clout might allow these companies to weather any tariff costs. But people know all too well how much a phone costs, making a sudden price increase on a finished product an unpleasant consumer experience. It’s like the price of modern bread, perhaps.
Overall, the dizzying tariff news “is a positive development for Apple and other tech companies,” Wedbush Securities analyst Dan Ives said in a note to clients. He said it creates room for some form of negotiation with China and could lead to a de-escalation of trade war issues that are currently tying big tech companies to the fence.
Their importance to U.S. tech hegemony means they are too important to fail in some way, and the value they bring to the stock market makes the rest of the S&P look like small satellites in the solar system orbiting them.
But in this chaotic environment, the most important difference is not just size, but tariff exemptions.
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