Apple stock (AAPL) jumped more than 6% on Monday following news of a temporary tariff relief between the U.S.-China trade war tensions. The relief sparked optimism among investors, easing fears of higher costs and supply chain disruptions. However, despite the short-term boost, questions remain about how long the rally can last amid macroeconomic headwinds and continued tariff uncertainty.
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For context, the temporary relief reduced U.S. tariffs on Chinese goods from 145% to 30% and Chinese tariffs on U.S. goods from 125% to 10%, alleviating immediate cost pressures on Apple, which heavily relies on Chinese manufacturing for its products. Notably, the agreement introduces a 90-day halt on any new tariff increases.
What’s Next for Investors?
While the stock has rebounded, analysts advise caution. The temporary nature of the tariff relief means that long-term strategies should account for potential reinstatements. That’s because Apple remains exposed to trade tensions. If a long-term agreement isn’t reached, tariffs could be reinstated, impacting profit margins, especially with the upcoming iPhone launch.
On the plus side, the tariff reduction provides immediate financial relief, potentially saving millions for Apple in the upcoming quarter. During its Q2 earnings call, Apple’s CEO Tim Cook revealed that tariffs could increase Apple’s costs by $900 million in the June quarter.
Moving ahead, investors should monitor developments in U.S.-China trade negotiations and the company’s supply chain diversification efforts.
Apple’s Tariff Strategy Under Scrutiny
The big question now is how Apple plans to ease supply chain strains without shifting the burden to consumers. Whether through increased manufacturing in India and Vietnam, renegotiated supplier contracts, or greater automation, Apple’s ability to protect margins without raising prices will be critical.
However, despite the recent U.S.–China tariff deal, a 30% tariff still applies to Chinese imports. On top of that, Apple continues to face 10% tariffs on products from secondary manufacturing hubs like India and Vietnam. Reflecting these ongoing pressures, The Wall Street Journal recently reported that Apple is considering raising prices for its upcoming iPhone 17 series, even as tariff tensions begin to ease.
Meanwhile, the Trump administration had pushed for Apple to move its device production, including iPhone manufacturing, to the U.S. However, many experts believe this would be both unlikely and costly for the tech giant. Following the latest deal, President Trump said he had spoken with Cook and indicated that the Apple CEO is planning to ramp up the company’s investment in the U.S. significantly.
Is Apple a Good Stock to Buy Right Now?
On TipRanks, AAPL stock has a consensus Moderate Buy rating among 29 Wall Street analysts. That rating is based on 17 Buys, eight Holds, and four Sells assigned in the last three months. The average AAPL price target of $228.65 implies almost 9% upside from current levels.
