US Stocks Fall After Trump Threatens Tariffs on EU, Apple

The stock market’s rebound from April’s rout has hit another tariff wall.

Traders work on the floor of the New York Stock Exchange on May 19, 2025. Spencer Platt/Getty Images

U.S. stocks fell before the Memorial Day long weekend after President Donald Trump threatened to impose tariffs on the European Union (EU) and smartphone manufacturers, including Apple.

The blue-chip Dow Jones Industrial Average fell by 256 points, or 0.61 percent, to finish the session. The broader S&P 500 dropped by 39 points, or 0.67 percent. The tech-heavy Nasdaq Composite Index fell by 188 points, or 1 percent.

Over the past month, the leading benchmark averages have rebounded from the tariff-fueled market rout. Since April 23, the Dow Jones has risen by 4 percent, the Nasdaq has advanced by more than 10 percent, and the S&P 500 has climbed by 6.5 percent.

U.S. Treasury yields initially fell, but then rebounded above 4.5 percent.

The U.S. dollar index, a measure of the dollar against a weighted basket of currencies, dropped by 0.6 percent and is poised for a weekly loss of about 1.8 percent.

Traders also sought shelter in the metals market. Gold prices soared by about $65.10, or 1.98 percent, to $3,360.10 per ounce. Silver picked up $0.40, or 1.2 percent, to $33.62 per ounce.

In a Truth Social post, Trump said he will implement “a straight 50 [percent] tariff on the European Union.”

According to the president, trade negotiations between the United States and the trade bloc “are going nowhere.”

“The European Union, which was formed for the primary purpose of taking advantage of the United States on trade, has been very difficult to deal with,” Trump said.

Speaking to reporters at the Oval Office, Trump stated that he is “not looking for a deal” with the EU.

“It’s set at 50 percent,” he said.

Trump initially set the tariff implementation date as June 1, but on May 25, he delayed the start date to July 9.

In 2024, the U.S. goods trade deficit with the EU was $235.6 billion, up by nearly 13 percent from 2023.

But the president’s decision might have less of an impact than tariffs imposed on Asian markets, according to Eric Teal, chief information officer for Comerica Wealth Management.

“The EU implications are less impactful than many of the Asian emerging markets that are key components to the technology sector supply chain,” Teal said in a note emailed to The Epoch Times.

“Although policy uncertainty injects more investment uncertainty, we believe this is part of the negotiating thesis to cut individual or regional deals, and we still believe that most companies and the economy are well positioned to power through the temporary higher import prices.”

The latest tariff development sent European stock market indexes plummeting.

Germany’s DAX declined by 369.59 points, or 1.54 percent. London’s Financial Times Stock Exchange dipped by 0.24 percent, while France’s CAC 40 Index dropped by 130 points, or 1.65 percent.

Although White House officials had been speaking generally positively regarding ongoing trade discussions, the president’s comments have potentially reignited trade fears.

The Trump administration recently reached a yet-to-be-finalized trade agreement with the UK. U.S. officials also agreed to a 90-day tariff pause with China, lowering tariff rates from triple-digit levels.

Trump has repeatedly stated that the EU has taken advantage of the United States on trade. On April 2, the president announced a blanket 20 percent tariff on the 27-member bloc. A week later, he authorized a pause and adjusted the import duty to 10 percent for 90 days.

Bite of the Apple

Investors are also responding to the president’s social media post threatening to slap a tariff “of at least 25 percent” on Apple.

“I have long ago informed Tim Cook of Apple that I expect their iPhone’s that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else,” he said in a separate Truth Social post. Trump later clarified that all smartphones made abroad would be subject to tariffs, not just Apple’s.

Apple iPhones are displayed in a store in Washington on April 8, 2025. Roberto Schmidt/AFP via Getty Images

Share prices of Apple (AAPL) slipped by more than 3 percent in premarket trading. In 2025, the stock is down by about 17 percent, to slightly more than $200.

Apple has been gradually shifting production of iPhones bound for the U.S. market to India from China.

Dan Ives, tech analyst at Wedbush, said shifting iPhone production to the United States would raise prices.

“The pressure from Trump on Apple to build iPhone production in the U.S. ... would result in an iPhone price point that is a non-starter for Cupertino and translate into iPhone prices of ~$3,500 if it was made in the U.S. which is not realistic in our view,” Ives said on social media platform X shortly after Trump’s comments.

When reporters at an Oval Office briefing in April asked about extending short-lived levy exemptions to Apple products, Trump said he is “a flexible person.”

“I don’t change my mind, but I’m flexible,” he said.

“There may be things coming up. I speak to Tim Cook. I helped Tim Cook recently. I don’t want to hurt anybody. But the end result is we’re going to get to the position of greatness for our country.”

Cook recently pledged to invest $500 billion in U.S. manufacturing over the next few years.

The Epoch Times has reached out to the European Commission for comment.