Tesla and Apple lead Mag Seven surge as Trump blinks on tariffs
The so-called magnificent seven tech stocks added more than $1.8tr in market value on Wednesday after Donald Trump unexpectedly paused a swathe of new tariffs, offering a rare moment of relief in an escalating trade war that had rattled big tech.
Shares of Nvidia, Apple, Tesla, Microsoft and others surged between eight and 19 per cent – with Nvidia alone gaining over $440bn in value.
The rally powered the Nasdaq to a historic 12.2 per jump – its biggest one-day gain since January 2001 – while the S&P rose 9.5 per cent.
Elsewhere, the Dow added nearly eight per cent.
Tariffs bruise Big Tech
The US tech sector had been hit by recently imposed global tariffs from Donald Trump’s aggressive trade policies earlier this week.
Beginning with an initial unilateral 10 per cent tariff on a wide array of goods, Trump’s announcement sparked severe market reactions.
What’s more, it wiped billions of dollars off the market value of the Magnificent Seven tech giants in just a matter of days.
In a span of two days, these firms collectively shed over $1.8 trillion in market value. The Nasdaq composite posted its worth weekly performance since the onset of the pandemic, and officially entered a bear market.
Nvidia and Tesla led the sell-off, with shares of both dropping by over six per cent. These firms have extensive supply chains in Asia, and are particularly vulnerable to the tariff hikes.
Apple, the world’s most valuable firm, saw its market value plummet as the stock dropped over six per cent as the market opened on Monday.
“Big tech’s AI ambitions require enormous capex, cross border talent, and complex hardware dependencies”, said Michael Ashley Schulman, of Running point capital. “Tariff and trade clarity are critical to removing layers of uncertainty from budgeting decisions.”
A sigh of relief for big tech
The reversal in tariffs marked a dramatic shift in tone from Trump, as he announced a 90-day pause on most new tariffs and a “substantially lowered” 10 per cent reciprocal rate on imports from dozens of countries.
On Wednesday, Google’s parent-firm Alphabet confirmed plans to invest $75bn in data center expansion – signalling confidence in the AI race even amid policy turbulence.
Meanwhile, Tesla, while still down over 28 per cent for the year, soared as much as 23 per cent in the day’s trading.
Apple rose over 15 per cent, while Microsoft added 10 per cent.
In retail, US consumers reportedly rushed to buy Chinese-made electronics amid fears of price hikes.
Apple stores saw a spike in traffic with one employee telling Bloomberg: “almost every customer asked me if prices were going to go up soon.”
“For the tech stocks this was much needed relief and pulls stocks and the market from the edge of the cliff”, said Dan Ives, analyst at Wedbush Securities. “Although China remains the biggest X factor, especially for Apple and the broader supply chain.”
However, the White House simultaneously raised tariffs on Chinese goods from 104 per cent, to 125 per cent, keeping pressure on the world’s second-largest economy and its tech-heavy export base.
Tech stocks have been under heavy pressure in recent months, losing a combined $5tr in market value since their peak in late 2024.