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Apple and Tesla are facing major headwinds in China which is contributing to investor jitters around the two U.S. technology giants.

Tesla shares tanked 12% on Tuesday after the electric car maker reported deliveries that fell short of analyst expectations, while Apple dropped more than 3% as concerns resurfaced about demand for the company’s flagship iPhone in the December quarter.

Challenges in China are partly behind the stock falls. The world’s second-largest economy accounts for around 17% of Apple’s sales and 23% of Tesla’s revenue, making it a significant market for both American companies.

“China is the hearts and lungs of both demand and supply for both Apple and Tesla. The biggest worry for the Street is that the China economy and consumer are reining in spending and this is an ominous sign” for Apple and Tesla, Daniel Ives, senior equity analyst at Wedbush Securities, told CNBC.

“In 2022 the worry was supply chain issues and zero Covid related issues, 2023 is the demand worries and this has cast a major overhang on both Apple and Tesla which heavily rely on the Chinese consumer.”

For Apple, investors have one eye on the company’s fiscal first-quarter results likely to be released later this month which cover the crucial December holiday period.

But in October, the world’s biggest iPhone factory in Zhengzhou, China, was hit with a Covid outbreak. Taiwanese company Foxconn, which runs the plant, imposed restrictions. In November, the factory was rocked by worker protests over a pay dispute with many employees walking out. Foxconn has attempted to entice workers back with bonuses. Reuters reported Tuesday that Foxconn’s Zhengzhou factory is almost back to full production.

The episode highlighted Apple’s reliance on China for iPhone production. In early November, after Foxconn imposed Covid restrictions at the factory, Apple said the plant was operating at a “significantly reduced capacity.”

Analysts at Evercore ISI estimate a $5 billion to $8 billion revenue shortfall for Apple in the December quarter. Apple could report a 1% annual decline in revenue in the December quarter, according to Refinitiv consensus estimates. That is worrying investors who were expecting a strong showing for the iPhone 14 series, the company’s latest smartphone.

But it is not just the supply chain issues Apple is facing now. China has reversed course on its zero-Covid policy as it looks to reopen the economy. Beijing’s policy involved strict lockdowns and mass testing to try to control the virus. Now there are Covid-19 outbreaks across large parts of the country which could impact demand for iPhones.

“The key challenge is expected to be on the demand side, especially since resilient high-end consumers may have started to shift their spending to travel while some may have shifted their focus to medical supplies. The shift in spending will pose a key challenge in the short term,” Will Wong, research manager at IDC, told CNBC.

Tesla’s Tuesday share price plunge was driven by a miss in vehicle deliveries, the closest approximation of sales disclosed by Elon Musk‘s electric car maker. The 405,278 cars delivered in the fourth quarter of 2022 fell short of expectations for 427,000 deliveries.

Again, the China demand story is in focus as well as the supply chain.

Throughout 2022, Tesla faced Covid disruptions at its Shanghai Gigafactory. But analysts also said there is concern over demand from Chinese consumers.

“Tesla will point to supply disruptions and lockdowns as the main problem in China in 2022.  While these are real headwinds, it cannot hide the fact that demand has softened for a variety of reasons and their order backlog is 70% smaller than it was prior to the Shanghai lockdown,” Bill Russo, CEO at Shanghai-based Automobility, told CNBC.

Lockdowns in Shanghai began in late March 2022 as the megacity’s government sought to control a Covid outbreak.

Investors are also concerned that Tesla will have to cut prices to attract buyers which could pressure margins. In China, Tesla slashed the price of its Model 3 and Model Y vehicles in October, reversing some of the price rises it made earlier in the year.

But another major headwind for Tesla in China is the rising competition from domestic rivals like Nio and Li Auto as well as lower-priced competitors, which are launching new models in 2023.

“Tesla’s models have been in the market for a while and are not as fresh to the Chinese consumer as other alternatives. What we are learning is EV product life cycles are short as they are shopped for their technology features. Buying an older EV is like buying last year’s smartphone,” Russo said.

“They need new or refreshed models to reignite the market. Just pricing lower can damage their brand in the long run.”

A winter heatwave smashed several national temperature records across Europe over the New Year’s weekend, prompting meteorologists to sound the alarm, while some ski resorts were forced to close due to an absence of snow.

January temperatures reached an all-time high in several European states, with national records set in at least seven countries.

Polish capital Warsaw recorded temperatures of 18.9 degrees Celsius (66 degrees Fahrenheit) on Jan. 1 — more than 5 degrees Celsius above the previous record set 30 years ago.

Northern Spanish city Bilbao logged 24.9 degrees Celsius on New Year’s Day — temperatures that might typically be expected at the start of July. Switzerland experienced 20 degrees Celsius on Sunday.

Warm weather and low snowfall forced some low-altitude ski resorts in the northern Alps and French Pyrenees to close a few weeks after opening.

Among the European countries that recorded their hottest days in history were the Netherlands, Denmark, Poland, Czech Republic, Belarus, Latvia and Lithuania.

Regional records were also broken in France, Germany and Ukraine.

Meteorologists and climatologists expressed alarm over the unseasonably warm winter weather, saying there were “too many records to count” and that many of the overnight minimum temperatures were comparable to summer.

“We just observed the warmest January day on record for many countries in Europe,” Scottish meteorologist Scott Duncan said via Twitter.

“Truly unprecedented in modern records,” Duncan said Sunday, adding that the intensity and extent of the warmth across the region was “hard to comprehend.”

Maximiliano Herrera, a climatologist who tracks global weather extremes, described the temperature records as “the most extreme event ever seen in European climatology.” In remarks reported by The Washington Post on Monday, Herrera added, “Nothing stands close to this.”

Guillaume Séchet, a broadcast meteorologist in France, said Europe had “experienced one of the most incredible climatic days in history” on the first day of 2023.

The record-breaking winter heat in Europe follows the region’s hottest summer on record and comes in stark contrast to the extreme cold snap seen in the U.S. in recent weeks.

The Copernicus Climate Change Service, an intergovernmental agency that supports European climate policy, found that the average European temperature for August and for the three-month June-August period was the highest on record in 2022 by “substantial margins.”

A severe lack of rainfall and a sequence of summer heatwaves took a visible toll on European waterways, ratcheting up fears over food and energy production at a time when prices were skyrocketing because of Russia’s war with Ukraine.

In April last year, the world’s top climate scientists warned the fight to keep global heating below the critical threshold of 1.5 degrees Celsius had reached “now or never” territory.

The U.N.’s Intergovernmental Panel on Climate Change repeated calls for a massive reduction in global fossil fuel use to avert a climate catastrophe.

“It’s now or never, if we want to limit global warming to 1.5°C,” IPCC Working Group III co-chair Jim Skea said in a statement accompanying the report. “Without immediate and deep emissions reductions across all sectors, it will be impossible.”

The burning of fossil fuels — such as coal, oil and gas — is the chief driver of the climate emergency.

While some Americans are still recovering from holiday festivities, many others may have lingering effects of spending regrets. Overall U.S. retail sales increased 7.6% year-over-year between Nov. 1 and Dec. 24, according to the latest Mastercard SpendingPulse survey.

For many consumers, the amount of debt they took on to pay for holiday purchases grew as well. A new LendingTree study found 35% of Americans amassed holiday debt in 2022. The average amount was $1,549, the highest level since 2015 when the survey was first taken. And 37% of those taking on holiday debt said it would take them at least five months to pay it off.

If you want to pay off your holiday debt well before this summer, here are seven steps you need to take now.

More than half of holiday shoppers planned to pay with a credit card, the PwC survey found. The average household’s credit card balance exceeds $9,000. Overall, credit card balances for U.S. consumers had already reached their highest level in 20 years by last November — 15% higher than the year before, according to the Federal Reserve Bank of New York. Paying down the extra holiday debt you accumulated can help reduce some of that financial pressure. 

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This can be one of your New Year’s resolutions.

“If you’re strapped for cash today, plan for tomorrow,” said Nicole Cope, director of wealth strategies at Ally. She recommends starting 2023 with a resolution to pay off any high-interest credit card debt first, then setting a budgeting goal of paying it off in three to five months.

If your credit score is “good” to “excellent” — a FICO score of 670 or higher on a scale of 300 to 850 — you’re more likely to qualify for lower interest rates on credit cards, car loans and mortgages, experts say. So having a good score can have a dramatic impact on the cost of your debt. The more you cut the cost of the debt, the faster you’ll pay it off. 

Some credit card companies will provide your credit score for free. It’s often on your billing statement. To improve your score, start by checking your credit report and disputing any errors.

Through the end of 2023, you can get a free weekly copy of your report from each of the major credit bureaus — Equifax, Experian and TransUnion — at annualcreditreport.com.

Of course, you should pay your bills on time every time.

Also, don’t get too close to your credit limit on your cards. Using less than 30% of your available credit can help you maintain your score, credit experts say, while using less than 10% can actually help raise that number.

Apply for a card with an introductory 0% annual percentage rate offer on balance transfers. Transfer your current credit card balances to that new card. You may be charged a 3% fee on the amount you transfer, but you’ll pay no interest on your debt for 12 to 20 months. 

“A 0% balance transfer card, if you have good enough credit to get one, is the best weapon against credit card debt,” said Matt Schulz, chief credit analyst at LendingTree. “You can get almost two years without gaining interest.” 

Again, you generally have to have a good or excellent credit score to qualify for the best offers. Also, you probably won’t be able to do a balance transfer with the same card issuer. 

If you don’t ask for a lower rate, you won’t get it. But if you do ask, you probably will. A Lending Tree survey found 70% of people who asked for a lower interest rate on a card got one, and the average reduction was seven percentage points.

Making this phone call now is more important than ever. After seven consecutive interest rate hikes from the Federal Reserve, the average rate on a credit card is about 23%. Rates on store credit cards are over 30%.

Asking for a lower rate “is a good hedge against the Fed raising rates again and against the skyrocketing costs we’ve seen over the past year,” Schulz said. 

If you can’t get a 0% offer or lower rate on a card, try applying for a personal loan. If you qualify for a big enough loan with a lower interest rate than your current card’s rate, then you can consolidate all or most of your credit card debt with that loan. 

In early December, the average rate on a personal loan was 10.64%, less than half as much as the average credit card rate, according to Bankrate.com. 

Just don’t spend that loan money. If you take out a personal loan to pay off credit card debt, make sure you immediately pay off your card balances with the cash from the loan. 

About 1 in 10 consumers planned to use buy now, pay later loans to make holiday purchases, according to the PwC survey. You make an upfront payment with buy now, pay later products, then pay off the rest of the purchase in a predetermined number of installments. 

Buy now, pay later plans often don’t charge interest unless you miss a payment. If you miss one, you could get hit with interest on the unpaid balance, as well as a late fee. So make sure you double-check the terms of the buy now, pay later offer, and comply fully. 

Get a comprehensive review of your financial situation and a look at your credit obligations — credit cards and loans — for free from a credit counselor. When you work with a nonprofit credit counseling agency that is part of the National Foundation for Credit Counseling, you’ll pay no fee for the initial counseling session.

“The outcome of the session results in the delivery of an action plan, identifying each possible option for improving financial well-being and managing debt,” said NFCC senior vice president Bruce McClary. 

The counselor may recommend coming up with a “debt management plan” between you and card issuers or lenders to amend your original payment agreement. That plan may allow you to lengthen your repayment term, lower the interest rate, and/or waive fees. You’ll still have to pay in full, just under more manageable circumstances. 

Fees are typically charged for a debt management plan, McClary said, with a program activation fee of $40 to $50 and monthly fees of $25 to $35. The cost can vary depending on the amount of debt that’s part of the plan or the number of accounts included.

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Salesforce said on Wednesday it would lay off about 10% of its employees and close some offices, becoming the latest tech firm to undertake cost cuts amid an economic slowdown.

The company expects the move to lead to about $1.4 billion to $2.1 billion in charges, of which about $800 million to $1 billion will be recorded in the fourth quarter of fiscal 2023.

“The environment remains challenging and our customers are taking a more measured approach to their purchasing decisions,” co-Chief Executive Officer Marc Benioff said in a letter to employees.

Companies from Meta Platforms to Amazon.com have in the past year taken steps to prepare for a deep downturn as global central banks have aggressively raised interest rates to tame decades-high inflation.

Businesses that relied on cloud services during the pandemic are now trying to reduce expenses through job cuts or delaying new projects, which has hurt companies such as Salesforce, which owns office messaging app Slack, and Teams parent Microsoft.

“As our revenue accelerated through the pandemic, we hired too many people leading into this economic downturn we’re now facing, and I take responsibility for that,” Benioff said.

Salesforce growth has slowed during the past four quarters, with the company posting its weakest revenue increase for the three months ended Oct. 31, as a strong dollar also eats into its sales.

The company said affected employees in the United States will receive a minimum of about five months pay, health insurance and other benefits while those outside the country will receive a “similar level of support”.

Salesforce had 73,541 employees at the end of January last year.

Shares of Salesforce rose 3% before the bell, after losing nearly half of their value in 2022.