What Happened?

A number of stocks fell in the afternoon session after President Donald Trump threatened to impose 'massive' new tariffs on Chinese goods. 

In a post on his Truth Social network, Trump stated that his administration is calculating a 'massive increase of Tariffs on Chinese products.' Trump targeted China's tightening controls on rare earth metals, which are vital components in many technology products from electric vehicles to defense systems. The threat immediately impacted the market, with the tech-heavy Nasdaq sinking 2.4% and the broader S&P 500 falling 1.7%. Such tariffs could significantly disrupt the global supply chains that many technology companies rely on for manufacturing and components. The policy uncertainty also raises fears of retaliatory measures from China, which could impact sales in a key international market for many U.S. tech firms, leading to investor concern over future profitability. 

Earlier in the week, China announced new export controls on the critical minerals. Beijing's Commerce Ministry stated that foreign suppliers now need government approval to export products containing certain rare-earth materials. These materials are essential for producing high-tech goods, including computer chips, electric vehicles, and defense technology. Analysts viewed the move as a strategic assertion of China's dominance in the global rare earth supply chain, particularly amid ongoing trade tensions.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Social Networking company Snap (NYSE: SNAP) fell 4.8%. Is now the time to buy Snap? Access our full analysis report here, it’s free for active Edge members.
• Consumer Subscription company Bumble (NASDAQ: BMBL) fell 5.6%. Is now the time to buy Bumble? Access our full analysis report here, it’s free for active Edge members.
• Online Retail company Carvana (NYSE: CVNA) fell 5.2%. Is now the time to buy Carvana? Access our full analysis report here, it’s free for active Edge members.
• Online Retail company Wayfair (NYSE: W) fell 4.1%. Is now the time to buy Wayfair? Access our full analysis report here, it’s free for active Edge members.
• Consumer Subscription company Roku (NASDAQ: ROKU) fell 3.5%. Is now the time to buy Roku? Access our full analysis report here, it’s free for active Edge members.

Zooming In On Bumble (BMBL)

Bumble’s shares are very volatile and have had 27 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 7 days ago when the stock dropped 2.4% on the news that Goldman Sachs downgraded the stock from Buy to Neutral and lowered its price target to $7 from $8. 

The investment bank pointed to low visibility into the dating app's turnaround. Analysts noted that Bumble's app downloads had dropped more than 35% compared to the previous year, partly because the company reduced its marketing efforts. The competitive environment also grew more challenging, as competitor Hinge continued to gain users while Tinder saw better international trends. Due to these factors, Goldman Sachs stated that it did not expect to see a significant improvement for the main Bumble app until the middle of 2026, viewing the stock's risk and reward as more balanced at its current price.

Bumble is down 34.8% since the beginning of the year, and at $5.20 per share, it is trading 42.8% below its 52-week high of $9.08 from November 2024. Investors who bought $1,000 worth of Bumble’s shares at the IPO in February 2021 would now be looking at an investment worth $73.89.

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