Kevin Hassett, economic advisor to President Donald Trump, said Thursday that the slowing Chinese economy could hurt the earnings and revenue of U.S. corporations doing business there.
“There are a heck of a lot of U.S. companies that have a lot of sales in China that are basically going to be watching their earnings be downgraded … until we get a deal with China,” Hassett said on CNN. “It’s not going to be just Apple.”
Hassett’s comments on CNN, and similar remarks to reporters outside the White House Thursday, came as Apple shares were getting slammed after CEO Tim Cook acknowledged a slowdown in fiscal first-quarter sales, in an investor letter released late Wednesday. Cook said, in a subsequent CNBC interview, that “trade tensions between the United States and China put additional pressure on their economy.”
“I think that puts a lot of pressure on China to make a deal,” Hassett told CNN. “Their economy, for them, you might call a ‘recession.’ It’s slowing down in a way that they haven’t seen in a decade.”
The rare warning from Apple, which sparked concerns about the Chinese economy and growth prospects worldwide, had Wall Street reeling, sending stocks down more than 2 percent.
However, Hassett said, “If we have a successful negotiation with China then Apple sales and everybody else’s sales will recover. But right now, China is feeling the blow of our tariffs.”