Apple Inc. (AAPL) shares surge 3.18% on Trump tariff exemption, $100B U.S. investment plan.

Apple Inc. (AAPL) shares surged 3.18% on August 7, 2025, extending a two-day rally of 8.43% and hitting a peak not seen since August 2025. The stock climbed 3.56% intraday, driven by a $100 billion U.S. manufacturing investment plan announced earlier in the day. The move, part of a broader $600 billion U.S. infrastructure pledge, aligns with President Trump’s 100% tariff on imported semiconductors, which grants exemptions to companies committing to domestic production. CEO Tim Cook’s endorsement at a White House event underscored the strategic shift, positioning Apple to avoid an estimated $1.1 billion in quarterly import costs on critical components like iPhone chips.

The strategy of buying AAPL shares after they reached a recent high and selling them one week later delivered moderate returns over the past five years. The strategy achieved a 70.53% return, compared to a 66.02% return for the benchmark, resulting in an excess return of 4.51%. The Sharpe ratio was 0.90, indicating a reasonable risk-adjusted return. However, the strategy had a maximum drawdown of 0.00%, which suggests that it effectively managed risk during market downturns.

Analysts highlighted the tariff exemption as a competitive advantage, with Bank of America’s Wamsi Mohan raising AAPL’s price target to $250 per share. The exemption, however, has drawn skepticism from critics like Threadneedle’s Ann Berry, who argue the investment is more symbolic than operational. Berry noted that Apple’s core manufacturing—particularly semiconductor packaging—remains reliant on Chinese factories, with domestic scaling requiring years of infrastructure development. Meanwhile, the company’s parallel expansion in India, which began prior to Trump’s tariff threats, has enabled it to bypass import duties on finished iPhones, leveraging the country’s growing tech ecosystem and government incentives.

Investor sentiment remains mixed. While today’s rally reflects optimism over tariff mitigation and manufacturing diversification, AAPL has declined 12% year-to-date amid concerns about its pace in the AI race compared to rivals like Microsoft. The stock’s short-term gains contrast with broader uncertainties, including Trump’s unpredictable trade policies and potential retaliatory measures from trading partners. Analysts caution that the $100 billion U.S. investment may not offset long-term challenges such as rising material costs, supply chain bottlenecks, and evolving competition in cloud computing and AI.

The geopolitical context further complicates Apple’s strategy. Aligning with Trump’s “America First” agenda has secured immediate exemptions but exposes the company to policy volatility. For instance, threats to escalate tariffs on other sectors have created a high-stakes environment where future trade shifts could undermine current exemptions. While the India strategy offers flexibility, it also faces hurdles like infrastructure limitations and labor costs, which may delay full-scale production of complex components. Apple’s ability to balance political alignment with operational realities will be critical in determining whether its investments translate into sustained growth or remain a temporary buffer against global trade headwinds.