Investing.com -- Apple slumped on Monday, as Wall Street turned bearish on the iPhone maker in the wake of President Donald Trump's decision to hike tariffs on imported products from Beijing.
Apple (NASDAQ:AAPL) fell more than 3% after HSBC downgraded its outlook on the company, warning that if tariffs affect Apple products imported into the U.S., the iPhone maker could be forced to raise prices, denting already weak demand for its pricey phones and lengthening the smartphone upgrade cycle.
The bank also outlined a risk in the Chinese market, noting that domestic consumers are accelerating the shift to smartphone substitutes by going to local brands with comparable functionality such as Huawei and Xiaomi.
The latest downgrade from HSBC echoed bearish recent notes from other banks, many of whom have also warned that Apple risks losing market share in China amid the hostile U.S.-China trade environment.
"We do not know yet if the retail price of the iPhone will increase in the U.S. However, we see the tariffs impacting Apple’s MacBook component costs,'' Rosenblatt Securities said.
Apple was the biggest loser among the 30 Dow stocks and was responsible 43 points of the Dow's decline. It also contributed nearly 25 points to the Nasdaq-100 index's 1.4% decline. The shares are trading nearly 22% below their 52-week high of $233.47 reached on Oct. 3.