Latest Stories

Apple’s plunge skews mostly positive week on US markets

AP Photo

NEW YORK — The showdown in Washington over the fiscal cliff gave US stocks another volatile week, but the apparent political stalemate — just weeks before a potentially devastating fiscal crunch — was not the defining market issue.

The key indices diverged sharply by Friday, with the explanation simple: Apple.

The iPhone and iPad maker, the world’s largest company by market capitalization, lost 8.9 percent in the week, ending at $533.25, down $52.

It was Apple’s weight that pulled the Nasdaq Composite down 1.07 percent to 2,978.04.

Meanwhile the Dow Jones Industrial Average closed the week at 13,155.13, up 0.99 percent.

And the broad-based S&P 500, which includes components from both, came in with an 0.13 percent gain to 1,418.07.

Apple’s fall, including a stunning 6.4 percent loss on Wednesday, the worst one-day drop in four years, accelerated the decline from its peak above $700 in September.

Analysts have begun raising doubts the market darling can keep up the astounding growth performance it has delivered in past years, especially as agile competitors challenge its leading cellphones and tablets.

“It’s becoming a show-me story. They’re going to have to meaningfully beat estimates on the next report,” said Michael James at Wedbush Securities.

Jody Giraldo at EquityStation said some investors are merely locking in gains before the end of the year.

“The stock had a very good run over the year, and it seems a lot of people continue to sell to lock in some returns,” he said.

Stripped of Apple, stocks seemed somewhat immune to the fight over the fiscal cliff, the $500 billion in tax hikes and spending cuts slated to come in beginning January 1 that could send the economy back to recession.

The cliff issue did not go away: by the end of the week, there was little sign that President Barack Obama and Congressional Republicans had found common ground on legislation that would avert the cliff.

Still, financials rose 1.1 percent in the week; capital goods 0.4 percent; big industrial groups 1.3 percent; and energy companies 0.8 percent.

Dozens more companies were taking action because of the fight — moving forward dividend payments and announcing hefty special payouts, to avoid higher dividend taxes likely to come after January 1.

They included Washington Post Co., Expedia, Sirius XM Radio, National Healthcare, T. Rowe Price and many others.

Analysts expect the cliff fight to have more of a negative impact on the market in the coming week if there is no sign of compromise between Republicans and Democrats on the key issues.

Otherwise, the focus will be on the Federal Reserve’s last policy meeting of the year on Tuesday and Wednesday, with an announcement to be made on Wednesday.

With November’s job creation data still unimpressive — even if the unemployment rate fell to 7.7 percent — the Fed is expected to hold firm on its ultra-low rates policy and expand its outright bond purchase program to make up for the expiration of its Operation Twist intervention.

“We expect the Fed to decide next week that it is not prepared to allow ‘Operation Twist’ to expire without being replaced,” said Nigel Gault at IHS Global Insight.

The replacement purchases would likely be around $45 billion a month, taking total Fed action aimed at pressing down long-term interest rates to $85 billion a month, he said.

Key data releases over the coming week include the trade balance in October (Tuesday), import prices (Wednesday); retail sales and producer prices for November (Thursday); and consumer prices (Friday).

Follow Us

Follow us on Facebook Follow on Twitter Follow on Twitter

Recent Stories:

Complete stories on our Digital Edition newsstand for tablets, netbooks and mobile phones; 14-issue free trial. About to step out? Get breaking alerts on your mobile.phone. Text ON INQ BREAKING to 4467, for Globe, Smart and Sun subscribers in the Philippines.

Tags: Apple , Business , stocks , US markets

  • http://pulse.yahoo.com/_EDXEVEFHW2ZT5VWHDWBNM6XGE4 RyanE

    The once superior Apple products have suffered because of those poor-quality made in China. Apple should devote more of its time in improving quality, not in filing cases against its competitors.

    • lucidlynx

      stock market ang pinag-uusapan dito hindi sales ng iPhone o iPad.

  • http://pulse.yahoo.com/_AIPSCQM2TZQUMQ5GEIMWMWDFL4 Edward Solilap

    The shinning stars made in the USA disappeared slowly and so their economy. Recall all your factory back to US and regain the respect of the world with reliable product that once the pride of American people.

    • lucidlynx

      this has got nothing to do where factories are located. it’s about the stiff competition in the technology field. don’t you people know anything about running a business? investors will always put their bets in the safest portfolio. they’d rather diversify their investments rather than put everything in one nest. and some investors may be selling apple shares for profit-taking. apple is still the company to beat with the highest share price. that’s how you play in the stock market.

Copyright © 2014, .
To subscribe to the Philippine Daily Inquirer newspaper in the Philippines, call +63 2 896-6000 for Metro Manila and Metro Cebu or email your subscription request here.
Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:
c/o Philippine Daily Inquirer Chino Roces Avenue corner Yague and Mascardo Streets, Makati City, Metro Manila, Philippines Or fax nos. +63 2 8974793 to 94


  • Ukraine FM: We are ready to fight Russia
  • Slain officer’s ‘diagram’ rocks PNP
  • 2 contractors fined P25,000 for delays in Edsa rehab
  • Luisita beneficiaries take over renters
  • 5 years of hard work pay off for top UP grad
  • Sports

  • Sharapova advances to Stuttgart quarterfinals
  • Galedo caps ride of redemption
  • Beermen, Express dispute second semis slot today
  • Lady Agilas upset Lady Bulldogs in four sets
  • NLEX roars to 7th D-League win
  • Lifestyle

  • A brand for life
  • Wear a rainbow on your wrist
  • Wearing Kate Moss
  • Sail into summer
  • Life lessons from the Ultimate Warrior
  • Entertainment

  • Kristoffer Martin: from thug to gay teen
  • Has Ai Ai fallen deeply with ‘sireno?’
  • California court won’t review Jackson doctor case
  • Cris Villonco on play adapted from different medium
  • OMB exec’s assurance: We work 24/7
  • Business

  • Gaming stocks gain, PSEi eases on profit-taking
  • Cebu Pacific flew 3.74M passengers as of March
  • Corporate bonds sweeteners
  • Professionals in the family business
  • Foreign funds flowed out in Q1, says BSP
  • Technology

  • Vatican announces hashtag for April 27 canonizations
  • Enrile in Masters of the Universe, Lord of the Rings?
  • Top Traits of Digital Marketers
  • No truth to viral no-visa ‘chronicles’
  • ‘Unlimited’ Internet promos not really limitless; lawmakers call for probe
  • Opinion

  • Editorial Cartoon, April 25, 2014
  • No deal, Janet
  • Like making Al Capone a witness vs his gang
  • MERS-CoV and mothers
  • A graduation story
  • Global Nation

  • Afghan hospital guard kills 3 American doctors
  • Career diplomat is new PH consul general in Los Angeles
  • US4GG: Aquino should ask Obama for TPS approval, drone technology
  • Complex health care system for California’s elderly and poor explained
  • Tiff with HK over Luneta hostage fiasco finally over
  • Marketplace