Quick overview

Apple’s recent breakout rally was cut short as renewed trade tensions sparked risk-off sentiment, sending AAPL shares sharply lower after an early-session surge.

A Strong Start Meets Sudden Reversal

Apple Inc. (NASDAQ: AAPL) opened the new trading week with bullish momentum, surging to an intraday high of $216.23 during the early U.S. session. However, the optimism didn’t last long. As the day progressed, investor sentiment flipped sharply, with AAPL plummeting to a low of $208.80 before closing at $209.95—marking a 2% daily decline.

The reversal came amid renewed risk aversion in global markets following the surprise announcement of 25% tariffs on imports from South Korea and Japan, set to take effect on August 1. In response, traders fled equities in favor of safe havens, notably buying U.S. dollars and gold, while selling off major U.S. tech names—including Apple.

Apple’s Tariff Exposure Raises Red Flags

With the vast majority of its hardware manufacturing occurring overseas—primarily in China, but also in Indonesia and India—Apple remains especially vulnerable to shifts in global trade policy. Any additional tariffs, either direct or indirect, threaten to increase costs and squeeze margins, putting downward pressure on the stock.

Last Week’s Breakout Rally Driven by Tech Buzz

The drop comes on the heels of a strong four-day winning streak last week, during which Apple bucked the broader weakness in the tech sector. The rally was fueled by reports that Apple is exploring partnerships with OpenAI and Anthropic.

The company is said to be considering integration of external AI models to power its next-generation Siri assistant, a move seen as an acknowledgment of its lag behind competitors in the AI arms race. The breakout sent AAPL from $201 to a close of $213.55, delivering a solid 6% weekly gain and breaking out of a frustrating three-month range.

Looking Ahead: Can Momentum Return?

Despite the recent excitement over its AI direction, Apple is now at the mercy of broader geopolitical and macroeconomic headwinds. With trade tensions reemerging and market volatility picking up, further downside below the $200 level is a growing possibility unless sentiment stabilizes.

Unless clarity emerges on the tariff front or Apple delivers a major catalyst, such as confirmed AI product rollouts, traders may remain cautious about pushing the stock higher in the short term.