Technology stocks have dropped more than 7% since President Donald Trump’s inauguration in January, driven by new tariffs that have ignited a trade war and rattled Wall Street.

The S&P 500 technology sector has fallen 7.5%, with major companies like Nvidia, AMD, and Tesla experiencing steep losses. Economists warn that the tariffs could push inflation higher and create global economic shocks, prompting investors to pull back from high-performing stocks to reduce risk.

Nvidia, a leading artificial intelligence chipmaker, has seen its shares plummet about 17% since Trump took office. The stock tumbled nearly 9% on Monday alone following the tariff announcement but managed a modest 1.7% recovery on Tuesday. Nvidia manufactures most of its chips in Taiwan, though some of its more advanced systems are produced in other regions.

The broader semiconductor sector has also struggled. The VanEck Semiconductor ETF has declined nearly 13% since the inauguration, while AMD shares are down 17%. Broadcom and Marvell Technology have faced even sharper losses, with their stocks sinking 21% and 29%, respectively.

Tesla, backed by Elon Musk, has lost more than a third of its value, while tech giants like Alphabet, Microsoft, and Amazon have each seen their stocks drop by at least 9%. Apple, however, remains a rare exception, showing a 3% increase despite the broader market downturn.

The trade war escalated after Trump dismissed the possibility of a last-minute deal on Monday, opening the door for 25% tariffs on goods from Canada and Mexico. He also imposed an additional 10% duty on Chinese products.

In response, Canada announced retaliatory tariffs set to take effect as early as Tuesday, while Mexico prepared its own countermeasures to be unveiled by Sunday. China also hit back, imposing tariffs of up to 15% on certain US goods.

The ongoing trade conflict has added volatility to the tech sector, raising concerns about rising manufacturing costs for companies like Nvidia and Apple, which rely on overseas production.

As tensions rise and market uncertainty grows, the tech industry's future remains unclear, with investors closely watching how both companies and governments react to the rapidly evolving trade landscape.

PHOTO: ISTOCK

This article was created with AI assistance.