It was only a month ago that Apple Inc. was the biggest U.S. company by market capitalization.

Since then, it has lost that crown to Microsoft Corp. and at times ceded second place to Amazon.com Inc.

The final blow to its dominance came Thursday as Apple shares (AAPL) tumbled in the wake of its revised quarterly sales forecast, flipping positions with Google parent Alphabet Inc. to put it at the bottom of the heap.

A senior White House adviser said on Thursday that a sharp drop in Chinese economic growth will hit the profits of U.S. firms but sales by Apple and other American companies should recover once Washington strikes a trade deal with Beijing.

"If we have a successful negotiation with China, then Apple's sales and everybody else's sales will recover," White House Chairman of the Council of Economic Advisers Kevin Hassett said in an interview with CNN.

Hassett said Asian economies including that of China have been slowing quite a bit since last spring and that China is "feeling the blow" of U.S. tariffs.

"That is having an impact on earnings and it's not going to be just Apple," Hassett said. "I think 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 next year until you know we get a deal with China."

Apple's warning on Wednesday about weak iPhone demand in the holiday quarter was a gloomy omen for Wall Street bulls hoping for an early gift in 2019 following December's steep selloff.

Factory activity weakened across much of Europe and Asia in December as the U.S.-China trade war and a slowdown in demand hit production in many economies, offering little reason for optimism as the new year begins. 

Material from Bloomberg and Reuters has been used in this report.

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