TOKYO (Reuters) – Asian shares fell and Wall Street was poised to retreat from record highs on Tuesday after Apple Inc (AAPL.O) said it would miss its March quarter revenue guidance as the coronavirus slowed production and weakened demand in China.

The warning from the most valuable U.S. company sobered investor optimism that stimulus from China and other countries would protect the global economy from the effects of the epidemic.

S&P500 e-mini futures ESc1 slipped as much as 0.4% in Asian trade while Nasdaq futures NQcv1 fell 0.6%.

European stocks were expected to follow suit, with major European stock futures STXEc1 FDXc1 FFIc1 trading 0.5-0.6% lower.

MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS fell 1.0%, while Tokyo’s Nikkei .N225 slid 1.4%, dragged down by tech stocks.

China’s CSI300 .CSI300 blue chip shares gave up 0.5%, following a strong rally that was fueled by hopes Beijing would introduce more policy stimulus.

China’s central bank cut the interest rate on its medium-term lending on Monday, paving the way for a likely reduction in the benchmark loan prime rate on Thursday.

However, sentiment took a subsequent knock as Apple said factories in China were re-opening but ramping up more slowly than expected, reinforcing signs of a broader hit to businesses from the epidemic.

“Apple is saying its recovery could be delayed, which could mean the impact of the virus may go beyond the current quarter,” said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities.

“If Apple shares were traded cheaply, that might not matter much. But when they are trading at a record high, investors will be surely tempted to sell.”

Asian tech shares were also hit. Samsung Electronics (005930.KS) dropped 2.9%, Taiwan Semiconductor Manufacturing Co (TSMC) (2330.TW) lost 2.9% and Sony Corp (6758.T) shed 2.5%.

In China, the number of new Covid-19 cases fell to 1,886 on Monday from 2,048 the day before. The World Health Organization cautioned, however, that “every scenario is still on the table” in terms of the epidemic’s evolution.

As China’s authorities try to prevent the spread of the disease, the economy is paying a heavy price. Some cities remained in lockdown, streets are deserted, and travel bans and quarantine orders are in place around the country, preventing migrant workers from getting back to their jobs.

Many factories have yet to re-open, disrupting supply chains in China and beyond, as highlighted by Apple.

“Lifting travel restrictions is taking longer than expected. Initially we thought lockdowns would end in February and factory output would normalize in March. But that is looking increasingly difficult,” said Ei Kaku, currency strategist at Nomura Securities.

Nomura downgraded its China first-quarter economic growth forecast to 3% from a year earlier, half the pace of the fourth quarter, from its previous forecast of 3.8%.

Nomura says there was a risk it could be even weaker.

Also hurting market sentiment was news that the Trump administration is considering changing U.S. regulations to allow it to block shipments of chips to Huawei Technologies from companies such as Taiwan’s TSMC, the world’s largest contract chipmaker.

Bonds were in demand, with the 10-year U.S. Treasuries yield falling 4.2 basis point to 1.546% US10YT=RR after a U.S. public holiday on Monday.

Safe-haven gold XAU= also rose 0.3% to its two-week high of $1,587.00 per ounce.

In the currency market, the yen ticked up 0.15% to 109.69 yen per dollar JPY= while the risk-sensitive Australian dollar lost 0.4% to $0.6686 AUD=D4. The yuan was steadier for now, trading at 6.9950 yuan per dollar CNY=CFXS.

The euro, grappling with worries about sluggish growth in the euro zone, edged down 0.1% to $1.0833 EUR=, near its 33-month low of $1.0817 touched on Monday.

Oil prices slipped on fresh concerns over the economic impact of the coronavirus outbreak in China.

Brent crude LCOc1 fell 0.6% to $57.30 a barrel, while U.S. West Texas Intermediate (WTI) crude CLc1 slipped 0.3% to $51.90 a barrel.

London copper prices also retreated 0.3% to $5,797 a tonne, slipping from Monday’s three-week high.

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