Wall Street shares tumble after Apple warning

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Wall Street stocks have slid sharply in the wake of a warning from Apple that its revenues would fall short because of a slowdown in China.

The Dow Jones Industrial Average plunged by nearly 600 points, or 2.5%, in early trading with big falls also seen for the S&P 500 and the tech-heavy Nasdaq.

Apple’s shares were down by 9%, confirming declines seen in pre-market trading and taking its market value – which last year saw it become the first listed company to be worth more than $1tn – below $700bn.

Technology stocks led the declines with chipmakers and other phone part suppliers both in the US and around the world in the red.

The sell-off also affected luxury brands including UK-based Burberry – down 5% – as Apple said China’s economic woes and trade war with the US was weighing on consumers in the world’s second biggest economy.

Apple chief executive Tim Cook said in a letter to shareholders, published after the close of trading on Wednesday, that it “did not foresee the magnitude of the economic deceleration” in the country.

The warning rattled already-volatile US markets, further feeding worries about global economic growth that have dragged on stocks in recent weeks and turned 2018 into the worst year since the financial crisis for Wall Street.

Market jitters even extended briefly to the Brexit-battered pound, which tumbled to a 21-month low close to $1.24 overnight against the US dollar in a “flash crash” triggered by an exodus from currencies considered riskier – before very quickly recovering the losses to return to around $1.26.

The reaction was less stark in other markets, with the FTSE 100 down by only about 0.3% in afternoon trading though Germany’s Dax and France’s Cac 40 were more than 1% lower.

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