Apple Inc (NASDAQ AAPL) shares are tanking in the wake of rising allegations about the buggy operating system update and the iPhone 6 Plus’ bending in pockets. Apple has lost a whopping $23 billion since the iPhone 6 was released on Sept. 19. Apple stock is reflecting the effect of mishaps related to the faulty operating system and apparently delicate hardware.
The stock closed down $3.88, or 3.8%, at $97.87 on Thursday, below the resistance of $100. Investors and traders are closely observing the $100 level because back in 2012, when shares fell below $100 (on a split-adjusted basis) they went into a reverse loop, declining 50%.
A day’s decline in Apple Inc (NASDAQ AAPL) stock is more than the entire market value of more than half of the individual companies in the S&P 500 Index, including big names such as Macy’s, Inc (NYSE M) and Chipotle Mexican Grill, Inc (NYSE CMG).
Apple Inc (NASDAQ AAPL): iPhone 6
Additionally, Apple is the most valuable stock on S&P, which suggests that a 3% drop in share value will pressurize the entire market, similar to what was seen on Thursday. Every $1 decline in Apple stock will scrap approximately .68 in the S&P 500. This suggests that a drop of $3 takes the market down by 2 points, excluding the ripple effect on other tech companies related to the iPhone. The S&P 500 fell 25.59 points Thursday to 1972.71.
Although Apple Inc (NASDAQ AAPL) stock is still up by 23% this year compared to the S&P’s 7% gain, investors are not used to it tanking just days after the launch of a new device. The iPhone is the most important and ambitious product from Apple, contributing at least half of its stock price, according to Trefis.com.
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Apple Inc financial news (NASDAQ AAPL)
There have been issues with Apple Inc (NASDAQ AAPL) products before as well, when the iPhone used to lose connectivity due to its antenna design, but co-founder Steve Jobs was able to rectify the problem. But with a lot of eyes on Apple’s performance, it might be difficult to cover up these new issues, which are potent enough to deride and marginally grind down Apple’s image.
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