Tariff Turmoil: Are Tech Stocks Out of the Woods?
Stocks have tumbled in recent weeks as President Donald Trump set out a tariff plan on products from countries around the world, and the biggest decliners have been in the tech sector. That's partly because these players rely heavily on other countries for the production of parts and finished products.A tax on these goods as they cross the U.S. border would weigh heavily on tech companies' costs, translating into pressure on earnings. And investors also worry that if tech giants lift the prices of items such as smartphones or laptops to compensate, people may hesitate to buy. That represents another threat to earnings.All of this pushed the tech-heavy Nasdaq Composite into a bear market and left many market giants like artificial intelligence (AI) chip leader Nvidia (NASDAQ: NVDA) and internet search and cloud powerhouse Alphabet at bargain valuations. In fact, the "Magnificent Seven," a group of tech companies that led market gains over the past two years, recently led indexes' declines.Continue reading
Stocks have tumbled in recent weeks as President Donald Trump set out a tariff plan on products from countries around the world, and the biggest decliners have been in the tech sector. That's partly because these players rely heavily on other countries for the production of parts and finished products.
A tax on these goods as they cross the U.S. border would weigh heavily on tech companies' costs, translating into pressure on earnings. And investors also worry that if tech giants lift the prices of items such as smartphones or laptops to compensate, people may hesitate to buy. That represents another threat to earnings.
All of this pushed the tech-heavy Nasdaq Composite into a bear market and left many market giants like artificial intelligence (AI) chip leader Nvidia (NASDAQ: NVDA) and internet search and cloud powerhouse Alphabet at bargain valuations. In fact, the "Magnificent Seven," a group of tech companies that led market gains over the past two years, recently led indexes' declines.
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