New York (CNN Business) Apple has stunned investors with a stark warning about its business in China.

US stock futures dropped sharply following Apple's announcement that it would miss its sales target for the final quarter of 2018 by at least $5 billion. Apple blamed weak sales in China for the revised forecast, reinforcing concerns that the country's slowing economy is already hurting earnings for multinational companies.

Stocks in Asia declined for a second consecutive day, but the losses were small. Benchmark indexes in Frankfurt and Paris dropped nearly 1% in early trade, while London's FTSE 100 opened down 0.3%.

Apple ( AAPL ) announced Wednesday after the closing bell that it would report lower-than-expected sales from the last three months of 2018, primarily because of weak demand for iPhones in China. In a letter to investors , CEO Tim Cook blamed the disappointing outlook on China's ongoing trade war with the United States and a number of other factors, including the company offering cheaper iPhone battery replacements.

The company's warning rattled Wall Street investors who were already jittery about China. Apple's announcement suggests corporate earnings estimates may be too lofty given challenges facing the global economy. Apple provided some of the starkest evidence of the negative consequences of the US-China trade war.

Apple shares listed in Frankfurt plummeted 8.7% on Thursday. The news also hit companies that provide components to the US tech giant. Hon Hai Precision ( HNHPD ), better known as Foxconn, fell 1.7% in Taipei. Catcher Technology, which makes iPhone cases, dropped nearly 6%. Shares in AMS ( AMSSY ), an Austrian company that makes light sensors, plummeted 20%.

Slowdown in China

What happens in China matters for businesses and markets across the globe. It's the world's largest exporter of goods, sucking in materials from other countries in order to ship out iPhones, laptops, bulldozers and tons of other products.

The country's rapidly expanding middle class has turned it into the biggest market on the planet for consumer goods like cars, smartphones and beer, generating billions in profits for companies like General Motors and Apple.

But after decades of expansion, the Chinese economy is slowing down . Growth in 2018 is set to be the weakest since 1990. And 2019 looks even worse. The world's second largest economy, China is feeling the effects of a darkening trade outlook and government attempts to rein in risky lending after a rapid rise in debt levels.

That has created a period of historic volatility in the stock market. Investors, fearful that a Chinese economic slowdown could stunt growth in companies around the globe, have sent stocks rising and (mostly) tumbling sharply in recent weeks and months. Between December 14 and 24, the Dow fell 350 points in six of seven sessions