US stock markets are expected to recover on Monday after President Donald Trump temporarily lifted tariffs on smartphones, laptops and chips imported from China. The exemption, which will last for 90 days, is seen as a major relief for tech companies like Apple and Nvidia, whose shares were on track to surge following the announcement.
The move came late Friday and is being viewed as a step back from Trump’s tough tariff stance, after pressure from Republican leaders who feared higher smartphone costs could trigger a backlash from voters. About 80% of smartphones sold in the US are imported many from China where a 145% tariff had been applied.
According to US Customs and Border Protection, the exemption covers items such as laptops, hard drives, smartphones, flat-panel monitors, and certain semiconductor chips. It also includes critical machines made overseas that are used to manufacture semiconductors in the US.
White House takes a softer tone, but China hits back
Trump, who had previously vowed “No retreat on tariffs,” appeared to soften his position. Speaking aboard Air Force One, he said he would clarify the rules on Monday, adding: “We’ve been making a lot of money. It’s been the other way around. Other countries, in particular China, were making a lot of money.”
While it’s unclear whether the exemption will be extended or replaced by new targeted tariffs, China has already responded by placing a 125% tariff on all US exports. Still, Beijing described the pause on smartphone duties as a “small step” toward easing tensions in the ongoing trade dispute between the world’s two largest economies.
Commerce Secretary Howard Lutnick confirmed that the relief is temporary and could end in 90 days. He stated that the administration plans to impose “a special focus-type of tariff” on these tech products to encourage companies to move manufacturing back to the US. He said.
“We can’t be relying on China for fundamental things that we need,”
Apple’s $500bn shift and tech’s path to recovery
Lutnick also pushed back against suggestions that the White House is backing down, saying the goal remains to bring smartphone and chip production to American soil. Meanwhile, Trump doubled down on his trade stance, writing on Truth Social:
“NOBODY is getting ‘off the hook’ for the unfair Trade Balances. Especially not China which, by far, treats us the worst!”
Apple, which has spent decades building a tightly coordinated supply chain across Asia including inside China, has committed to shifting some operations to the US over the next four years. This includes a new $500bn facility in Texas focused on AI server manufacturing, though much of its global supply network will remain in place.
Earlier this month, Trump’s tariff hike rattled the tech market, wiping out $2.1tn around 14% from the combined value of the “Magnificent Seven” tech firms: Apple, Microsoft, Nvidia, Amazon, Tesla, Google’s parent Alphabet and Facebook’s parent Meta. However, shares have started to recover since Wednesday after the administration paused most of the tariffs except on China allowing tech companies to explore other import routes like India.
