The so-called 'magnificent seven' tech stocks, including Nvidia, Apple, Tesla, and Microsoft, added more than $1.8tr in market value on Wednesday after an unexpected pause in new tariffs by Donald Trump, providing a rare moment of relief amidst an escalating trade war that had unsettled big tech.
Shares of these tech giants surged between eight and 19 per cent – with Nvidia alone gaining over $440bn in value, as reported by .
This rally propelled the Nasdaq to a historic 12.2 per cent jump – its biggest one-day gain since January 2001 – while the S&P rose 9.5 per cent.
In other developments, the Dow increased nearly eight per cent.
Tariffs bruise Big Tech
The US tech sector had been impacted by recently imposed global tariffs from Donald Trump's aggressive trade policies earlier this week.
Starting with an initial unilateral 10 per cent tariff on a wide array of goods, Trump's announcement triggered severe market reactions.
Moreover, it erased billions of dollars off the market value of the Magnificent Seven tech giants in just a few days.
Within two days, these firms collectively lost over $1.8 trillion in market value. The Nasdaq composite posted its worst 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, with extensive supply chains in Asia, are particularly vulnerable to the tariff hikes.
Apple, the tech giant boasting the title of the world's most valuable company, experienced a sharp decline in its market value as shares fell over six per cent as trading commenced on Monday.
"Big tech's AI ambitions require enormous capex, cross border talent, and complex hardware dependencies," commented Michael Ashley Schulman from Running Point Capital.
"Tariff and trade clarity are critical to removing layers of uncertainty from budgeting decisions."
A sigh of relief for big tech
In what could be considered a breath of fresh air for the big tech industry, the recent reversal in tariffs indicated a significant change in stance from former President Trump, who declared a 90-day moratorium on most new tariffs alongside introducing a significantly reduced reciprocal rate of 10 percent levied on imports from numerous countries.
Come Wednesday, Alphabet, Google's parent company, publicly confirmed its commitment to invest $75bn in expanding data centres – an act reflecting a strong belief in their competitive edge within the AI sector despite the unpredictability of international policies.
Tesla's performance, albeit down over 28 percent for the year, saw a remarkable uplift, skyrocketing by up to 23 percent during intra-day trading.
Other tech behemoths also fared well with Apple recording a rise of over 15 percent and Microsoft inching upwards by 10 percent.
On the retail front, US shoppers appeared to scramble for Chinese-manufactured electronics, spurred by concerns over potential price surges.
Apple's physical retail outlets registered an increase in customer flow, with one staff member relaying to 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," remarked Dan Ives, an analyst at Wedbush Securities.
"Although China remains the biggest X factor, especially for Apple and the broader supply chain."
Despite this mild reprieve for technology equities, the White House has concurrently hiked tariffs on Chinese goods from 104 percent to 125 percent, maintaining pressure on the world's second-largest economy and its predominantly tech-oriented export sector.
Tech stocks have felt significant pressure over recent months, with a staggering drop in combined market value of $5tr since their zenith in late 2024.
