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Trump exempts smartphones from ‘reciprocal’ tariffs after market rout

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Trump exempts smartphones from ‘reciprocal’ tariffs after market rout

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The Trump administration has excluded smartphones and other consumer electronics from its steep “reciprocal” tariffs in a significant boost for Big Tech as the White House battles to calm global markets after launching a multifront trade war. 

According to a notice posted late on Friday night by Customs and Border Patrol, smartphones, along with routers, chipmaking equipment, wireless earphones and certain computers and laptops, would be exempt from reciprocal tariffs, which include the 125 per cent levies Donald Trump has imposed on Chinese imports.

The carve-out is a big win for companies such as Apple, Nvidia and Microsoft, and follows a week of intense turbulence in US markets after Trump unleashed a trade war on “liberation day” on April 2. The announcement rattled global investors and triggered a stock market rout.

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The exemption is the first sign of any softening of Trump’s tariffs against China, which he ratcheted up over the course of the past week even as he paused the steepest “reciprocal” tariffs. He retained tariffs of 10 per cent on most trading partners.

The Trump administration had already exempted several sectors from its reciprocal tariffs, including semiconductors and pharmaceuticals, but the president has signalled that he still plans to apply tariffs to those sectors.

A White House official said on Saturday that the US would launch a separate probe that could lead to a tariff on chips “soon”.

The dispensation for smartphones and computers will be especially welcomed by Apple as the bulk of its supply chain is centred on China. Analysts estimate about 80 per cent of its iPhones are still made in the country even as the tech group worked to diversify production to India in recent years.

The majority of iPhones are made in a big factory complex in Zhengzhou operated by Apple’s manufacturing partner Foxconn. Workers at the plant told the Financial Times this week that operations were normal but that they were worried about the impact of the trade war.

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A Foxconn factory in Zhengzhou © VCG via Getty Images

Shares in the US tech giant were one of Wall Street’s biggest casualties in the days immediately after Trump announced his reciprocal tariffs. About $700bn was wiped off Apple’s market value in the space of a few days.

Earlier this week, Trump said he would consider excluding US companies from his tariffs, but added that such decisions would be made “instinctively”.

Chad Bown, a senior fellow at the Peterson Institute for International Economics, said the exemptions mirrored exceptions for smartphones and consumer electronics issued by Trump during his trade wars in 2018 and 2019.

“We’ll have to wait and see if the exemptions this time around also stick, or if the president once again reverses course sometime in the not-too-distant future,” said Bown.

US Customs and Border Protection referred inquiries about the order to the US International Trade Commission, which did not immediately reply to a request for comment.

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The White House confirmed that the new exemptions would not apply to the 20 per cent tariffs on all Chinese imports applied by Trump to respond to China’s role in fentanyl manufacturing.

White House spokesperson Karoline Leavitt said on Saturday that companies including Apple, TSMC, and Nvidia were “hustling to onshore their manufacturing in the United States as soon as possible” at “the direction of the President”.

“President Trump has made it clear America cannot rely on China to manufacture critical technologies such as semiconductors, chips, smartphones, and laptops,” said Leavitt.

Apple declined to comment.

Economists have warned that the sweeping nature of Trump’s tariffs — which apply to a broad range of common US consumer goods — threaten to fuel US inflation and hit economic growth.

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New York Fed chief John Williams said US inflation could reach as high as 4 per cent as a result of Trump’s tariffs.

Additional reporting by Michael Acton in San Francisco

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Supreme Court blocks redrawing of New York congressional map, dealing a win for GOP

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Supreme Court blocks redrawing of New York congressional map, dealing a win for GOP

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Win McNamee/Getty Images

The Supreme Court on Monday intervened in New York’s redistricting process, blocking a lower court decision that would likely have flipped a Republican congressional district into a Democratic district.    
  
At issue is the midterm redrawing of New York’s 11th congressional district, including Staten Island and a small part of Brooklyn. The district is currently held by a Republican, but on Jan. 21, a state Supreme Court judge ruled that the current district dilutes the power of Black and Latino voters in violation of the state constitution.  
  
GOP Rep. Nicole Malliotakis, who represents the district, and the Republican co-chair of the state Board of Elections promptly appealed to the U.S. Supreme Court, asking the justices to block the redrawing as an unconstitutional “racial gerrymander.” New York’s congressional election cycle was set to officially begin Feb. 24, the opening day for candidates to seek placement on the ballot.  
  
As in this year’s prior mid-decade redistricting fights — in Texas and California — the Trump administration backed the Republicans.   
 
Voters and the State of New York contended it’s too soon for the Supreme Court to wade into this dispute. New York’s highest state court has not issued a final judgment, so the voters asserted that if the Supreme Court grants relief now “future stay applicants will see little purpose in waiting for state court rulings before coming to this Court” and “be rewarded for such gamesmanship.” The state argues this is an issue for “New York courts, not federal courts” to resolve, and there is sufficient time for the dispute to be resolved on the merits. 
  
The court majority explained the decision to intervene in 101 words, which the three dissenting liberal justices  summarized as “Rules for thee, but not for me.” 
 
The unsigned majority order does not explain the Court’s rationale. It says only how long the stay will last, until the case moves through the New York State appeals courts. If, however, the losing party petitions and the court agrees to hear the challenge, the stay extends until the final opinion is announced. 
 
Dissenting from the decision were Justices Sonia Sotomayor, Elena Kagan, and Ketanji Brown Jackson. Writing for the three, Sotomayor  said that  if nonfinal decisions of a state trial court can be brought to highest court, “then every decision from any court is now fair game.” More immediately, she noted, “By granting these applications, the Court thrusts itself into the middle of every election-law dispute around the country, even as many States redraw their congressional maps ahead of the 2026 election.” 

Monday’s Supreme Court action deviates from the court’s hands-off pattern in these mid-term redistricting fights this year. In two previous cases — from Texas and California — the court refused to intervene, allowing newly drawn maps to stay in effect.  
  
Requests for Supreme Court intervention on redistricting issues has been a recurring theme this term, a trend that is likely to grow.  Earlier last month  the high court allowed California to use a voter-approved, Democratic-friendly map.  California’s redistricting came in response to a GOP-friendly redistricting plan in Texas that the Supreme Court also permitted to move forward. These redistricting efforts are expected to offset one another.     
   
But the high court itself has yet to rule on a challenge to Louisiana’s voting map, which was drawn by the state legislature after the decennial census in order to create a second majority-Black district.  Since the drawing of that second majority-black district, the state has backed away from that map, hoping to return to a plan that provides for only one majority-minority district.    
     
The Supreme Court’s consideration of the Louisiana case has stretched across two terms. The justices failed to resolve the case last term and chose to order a second round of arguments this term adding a new question: Does the state’s intentional creation of a second majority-minority district violate the constitution’s Fourteenth and Fifteenth Amendments’ guarantee of the right to vote and the authority of Congress to enforce that mandate?    
Following the addition of the new question, the state of Louisiana flipped positions to oppose the map it had just drawn and defended in court. Whether the Supreme Court follows suit remains to be seen. But the tone of the October argument suggested that the court’s conservative supermajority is likely to continue undercutting the 1965 Voting Rights Act.   

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Map: Earthquake Shakes Central California

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Map: Earthquake Shakes Central California

Note: Map shows the area with a shake intensity of 3 or greater, which U.S.G.S. defines as “weak,” though the earthquake may be felt outside the areas shown.  All times on the map are Pacific time. The New York Times

A minor earthquake with a preliminary magnitude of 3.5 struck in Central California on Monday, according to the United States Geological Survey.

The temblor happened at 7:17 a.m. Pacific time about 6 miles northwest of Pinnacles, Calif., data from the agency shows.

As seismologists review available data, they may revise the earthquake’s reported magnitude. Additional information collected about the earthquake may also prompt U.S.G.S. scientists to update the shake-severity map.

Source: United States Geological Survey | Notes: Shaking categories are based on the Modified Mercalli Intensity scale. When aftershock data is available, the corresponding maps and charts include earthquakes within 100 miles and seven days of the initial quake. All times above are Pacific time. Shake data is as of Monday, March 2 at 10:20 a.m. Eastern. Aftershocks data is as of Monday, March 2 at 11:18 a.m. Eastern.

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US says Kuwait accidentally shot down 3 American jets

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US says Kuwait accidentally shot down 3 American jets

The U.S. and Israel have been conducting strikes against targets in Iran since Saturday morning, with the aim of toppling Tehran’s clerical regime. Iran has fired back, with retaliatory assaults featuring missiles and drones targeting several Gulf countries and American bases in the Middle East.

“All six aircrew ejected safely, have been safely recovered, and are in stable condition. Kuwait has acknowledged this incident, and we are grateful for the efforts of the Kuwaiti defense forces and their support in this ongoing operation,” Central Command said.

“The cause of the incident is under investigation. Additional information will be released as it becomes available,” it added.

In a separate statement later Monday, Central Command said that American forces had been killed during combat since the strikes began.

“As of 7:30 am ET, March 2, four U.S. service members have been killed in action. The fourth service member, who was seriously wounded during Iran’s initial attacks, eventually succumbed to their injuries,” it said.

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Major combat operations continue and our response effort is ongoing. The identities of the fallen are being withheld until 24 hours after next of kin notification,” Central Command added.

This story has been updated.

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