The shares of Apple Inc.(NASDAQ:AAPL) witnessed a sharp fall after yesterday’s big drop. However, the shares of the pioneers of iPhones even after falling into a dig took a reverse gear and reflected an affirmative sign on heavier-than-usual trading volume with it share prices rising to $547.62 indicating a high of 1.7%, well off session low of $518.63.
Yesterday’s blackout was one of the darkest and the starkest since December 17th, 2008, which not only compelled the stock to push down by 6.4% but also wiped off $39.4 billion worth of the company’s market capitalization. There are several factors which piled together resulting in such a massacre. The company had been witnessing tensions about the intimidating “death cross” parallel to the concerns of losing the tablet market in the mist of tough competitions from its rivals Microsoft Corp., Amazon Inc., Google Inc. and Samsung Electronic Co. in addition to this the company has been low when the investors’ confidence in the company is taken into consideration. These problems that the company has been facing accumulated to see the mid-November lows. Tax-related selling ahead of the fiscal cliff has also hindered the stock.
Looking at the graph of the last decade shows a fairly mixed track record of the company in the face of “death cross”. The indicator highlights pessimistic short and long term implications on the stocks. However, according to Bespoke Investment Group, the death cross hasn’t historically proven to be a clear-cut sell signal for Apple. “The returns haven’t been as ‘deadly’ as one might expect.” Prior to this, the company witnessed a death cross on September 23rd, 2008 when the stocks of the company toppled 289% in the following month and 32% over the next three months.
Analysts anticipate that the current black-out will fade in course of time and urges the investors to stay with the company’s shares, providing an optimistic look at the company’s shares. Availability is improving and Apple products remain the ‘gift of choice’ this holiday season, indicating the investors’ about the long-term prospects of the company.