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When President Trump returned to the White House, tech executives from Apple, OpenAI, Oracle and other companies pledged to create thousands of jobs, fuel innovation and invest billions of dollars in the United States.
But technology stocks have been on a bumpy ride this year as trade disputes and the future of artificial intelligence have stoked economic uncertainty.
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Trump has gone back and forth about imposing tariffs on imports from Canada, Mexico and China, which tech giants rely on to produce laptops, phones and other gadgets.
And he’s threatened to levy tariffs on semiconductors that power consumer electronics while criticizing a federal program championed by his predecessor, Joe Biden, that has funded domestic semiconductor manufacturing.
The uneasiness among investors returned this week when some of the world’s most valuable companies, such as Apple, Nvidia and Tesla, shed billions of dollars from their market value after their share prices plunged on Monday.
The losses came after Trump warned in an interview on Fox News over the weekend that “there’s a period of transition” in the coming year and didn't rule out a recession. Commerce Secretary Howard Lutnick then told NBC News, “There’s going to be no recession in America.”
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“Investors don't know what's going to happen around the corner,” said Dan Ives, a Wedbush Securities analyst who covers the technology sector. “It's been an unsettling time, and that's why after a massive bull market, you're seeing, especially major tech stocks, go through just a disaster period to start the year.”
As of Wednesday, the NASDAQ-100 technology sector was down roughly 6% since January and the S&P 500 information tech sector had dropped nearly 10% this year (compared to a 5% drop for the market as a whole).
Various reasons explain the market turbulence, analysts say, pointing to investor worries about tariffs, investment levels in AI and a pullback in consumer spending.
Nvidia’s shares rose 6% on Wednesday but are still down 16% this year; it closed at $115.74 a share. The Santa Clara-based tech company, which makes computer chips, was hit hard in January after Chinese startup DeepSeek announced it had built a cheaper AI model with fewer computer chips.
Nvidia has been bracing for the impact of Trump’s trade policies. During its quarterly earnings call in February, Nvidia Chief Financial Officer Colette Kress said the effect of tariffs are “an unknown” until the company can “understand further what the U.S. government’s plan is.”