Former US President Donald Trump has issued a warning to Apple, stating that the company should face a 25% tariff if it manufactures iPhones in "India or anyplace else." Trump claims he informed Apple CEO Tim Cook that he expects iPhones sold in the US to be made in America.

Trump addressed Cook on his Truth Social platform, saying he expects iPhones sold in the United States to be manufactured and built in the United States, not India, or anyplace else. He added that if this isn't the case, a tariff of at least 25% must be paid by Apple to the US. These remarks come as Apple expands its manufacturing in India, shifting production out of China due to pandemic-related disruptions and geopolitical tensions.

During a previous state visit to Qatar, Trump recounted a conversation with Cook, criticizing Apple's increasing investment in India. Trump stated he told Cook that he didn't want Apple building in India, saying India can take care of themselves. Trump was referring to Apple’s earlier pledge to invest $500 billion in the United States, announced in February.

Cook stated that a majority of iPhones sold in the US will have India as their country of origin. Apple has increased its production in India, aiming to manufacture approximately 25% of global iPhones in the country within the next few years, reducing its dependence on China, where about 90% of its flagship smartphones are currently assembled. The company produced roughly $22 billion worth of iPhones in India in the year ending March 2025, a 60% rise from the previous year. Currently, India manufactures one in five iPhones globally, demonstrating the company's efforts to distribute production beyond China amidst ongoing trade disputes.

Trump also said that his administration would impose a 50 per cent tariff on the European Union, miffed at Washington's current trade deficit with the European Union, Trump said the Bloc was formed "for the primary purpose of taking advantage of the United States ". He is recommending a straight 50% tariff on the European Union, starting on June 1, 2025, unless the product is built or manufactured in the United States.

Stock markets in both the US and Europe experienced declines following Trump's announcements regarding tariffs targeting Apple and the EU. S&P 500 and Dow Jones Industrial Average futures decreased by 1.5%, whilst Nasdaq futures fell 1.7%. Apple shares also fell 3.8% in morning trading after Trump warned that the company could face a 25% tariff if it continues making iPhones outside the United States.

Wall Street is reacting to President Trump’s tax and trade agenda with rising Treasury yields and deficit fears pressuring the market. Investors are also eyeing Nvidia’s upcoming earnings, while uncertainty around tariffs and government spending lingers. The Dow Jones Industrial Average and the S&P 500 are both heading for weekly drops of about 2%, while the tech-focused Nasdaq Composite is down roughly 1.5%. This cautious trading mood comes just ahead of the Memorial Day weekend, when markets will be closed on Monday.

Investor sentiment has been shaken by Trump’s proposed 25% iPhone tariffs, a $2.7 trillion deficit-increasing tax-and-spending bill, and Moody’s U.S. credit downgrade on rising fiscal concerns. Apple stock fell 3.1% premarket due to the new tariff threat, reflecting concern over Trump's trade and tax agenda. Traders are digesting economic risks and rising government debt. Concerns over tariff-related retail cost pressures also weigh on the market, with Decker's Outdoor plunging -18% after skipping full-year guidance.

Rising Treasury yields and concerns over Trump’s tax-and-trade policy are the main factors driving stock market volatility. Markets are reacting to deficit fears and cautious investor sentiment ahead of Memorial Day. The combination of high Treasury yields, federal deficit concerns, and trade uncertainty means investors need to stay alert.