Apple Stock Down 4.6% After Trump ‘Orders’ Companies to Leave China

US President Donald J. Trump speaks

Apple’s share price was down around 4.6% Friday at the close of the market, to $202.64 per share, after President Trump took to Twitter to “order” U.S. companies to leave China. The slide came amid a market-wide sell-off, with the NASDAQ sliding 3%, and the Dow dropping 623 points.

Trump’s edict was a response to a new round of tariffs imposed by China on imported U.S. goods, which is set to go into effect starting next month. Earlier on Friday, China announced that it was going to impose tariffs of 5% to 10% on $75 billion worth of imports from the U.S. in two rounds, starting on September 1 and December 15.

The country will also reinstate tariffs on American cars and automobile parts. China’s latest round of tariffs comes in response to U.S. tariffs that will go in effect in September and December. Trump had originally announced that his administration would impose 10% tariffs on $300 billion worth of Chinese imports on September 1, but later relented, and exempted smart phones and other consumer electronics until mid-December.

On Friday, Trump took to Twitter to slam China’s decision. “We don’t need China and, frankly, would be far better off without them,” he tweeted, adding: “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 whether Trump’s “order” will result in any policy changes, and what authority he would have to tell American companies where to produce their wares. Still, Apple investors in particular seemed skittish about the prospect of any government interference. The company makes most of its products, including the iPhone, in China.

Moving its manufacturing to a different country would be challenging, as Wedbush analyst Daniel Ives pointed out in a note to investors Friday. “It would take at least 3 years to move 20% of iPhone production outside of its core Foxconn/China footprint,” he said. Ives also predicted that the trade war will continue to put pressure on Apple’s supply chain for some time to come. “This remains the nightmare that will not go away for investors,” he concluded.

Trump’s announcement that he would formally respond to China’s latest tariffs later today likely didn’t calm investors’ nerves either.

The latest policy threat to Apple’s global supply chain comes just days after Trump lauded Apple CEO Tim Cook, telling reporters that the Apple executive would often call him directly when he had problems to discuss. Most recently, these discussions apparently were all about tariffs, with Cook arguing that a 10% levy would put put Apple at a disadvantage in its competition with South Korea’s Samsung.

Update: This post was updated with Apple’s share price at the close of the market, as well as a quote from Wedbush analyst Daniel Ives.