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Apple Shares Fluctuate: iPhone 12 Underwhelming?



As of this past century, Apple has undoubtedly been a monstrous powerhouse in the smartphone industry. It has consistently released outstanding phones every year, and just this week, Apple introduced their brand-new iPhone 12. The announcement made waves across the smartphone market, yet unfortunately, the big news has caused Apple shares to fall by 2.7 per cent in the stock market, after rallying 6 per cent on the previous day. To begin with, the phone features a 6.1-inch display, and will sell for $799, with an array of versions including Mini, Pro, and Pro Max. Apple Inc promised to usher in a “new era” for its flagship product on Tuesday, with the hopes that consumers will trade in their old phones and keep its sales booming through the end of the year. Despite all that, the question remains whether the announcement for the iPhone 12 is underwhelming or not, due to the fluctuation of its shares. The main problem that investors see with the new smartphone launch would be how dependent the 5G aspect is with where the customers are located and which carrier they use, or as head of TECHnalysis Research, Bob O’Donnell states it as “lots of little niggly details that get in the way of delivering on the promise of 5G.” This issue, along with Apple’s recent news in regards to lost-item tracking tags, could potentially end up causing disappointment for both consumers and investors.


Ahead of the launch of the iPhone 12 on Tuesday (10/13), Apple's shares had jumped by 6.35% which previously had increased 10.47% when it closed last July. Previously, the launch of the iPhone 12 was awaited since 2017, as Apple had been planning to redesign the exterior of the iPhone 12 and also promised a faster network by providing 5G features. Katy Huberty, an Analyst from Morgan Stanley stated that ”We hope to launch the iPhone 12 in 2021 would be the most significant series for several years ”. Huberty also estimates that the sales will increase as most Iphone users would probably upgrade their Iphone. Other information, according to data from Morgan Stanley, Apple (AAPL) shares outperformed the S&P 500 by an average of 13 percentage points for 6 months after the launch of the New iPhone (which they also fell in a short period of time like).The same thing also happened after the launch of Iphone 12 which is showed bye Apple Shares that has fell from 2.6% to $ 121.14. Even though on Monday (10/12) AAPL closed at $ 124.40, that hasn't been good for investors who used call options to bet on a higher stock price after the event. Despite the fall, Apple remains the most popular single-stock option and much of the activity in recent months and has in weekly options, which are particularly speculative due to their short maturities.


Even though the rise in Apple shares didn't remain long, the early climb of the shares ahead of the event on Tuesday (10/13) becomes one of the sentiments in strengthening Wall Street in addition to the expectations of a stimulus package for COVID-19 pandemic assistance presented by the US government. Asides from Apple, Amazon shares also gained up to 4.8% in advance of their annual Prime Day shopping event on the 13th and 14th of October. Microsoft is also up 2.6%, pushing the benchmark S&P 500 to rise for 2.7%. One of the main points from the banking perspective is JP Morgan and Citigroup, which reported their quarterly performance on Tuesday. The report shows that JP Morgan made an astounding $9.4bn profit in Q3 after hardly getting net income below $4.6bn in Q2, following the pandemic's large scale impacts on the banking sector. Citigroup also posted their net income of $3.2bn compared to $1.3bn in Q2. Overall, the US's indices rose like the Dow Jones Industrial Average by 0.88% and Nasdaq up for 2.56%. On Wednesday (10/14), stocks listed on Wall Street are 'making the most significant moves' in premarket as of 7.30 am ET, namely: Goldman Sachs earned $ 9.68 per share in Q3, up 2.8% on premarket trading, PNC is up 1% on premarket trading, on the other hand, Bank of America fell 2% on premarket trading. All in all, the sentiment from the late Apple news and other significant events make the US market fluctuate.


Sources:

Barrons

Reuters

Financial Times


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