Apple Inc.(NASDAQ:AAPL)’s
shares tumbled by almost 5% on Wednesday, completing a dreary ten weeks period
for the most valuable company in the US. Analysts are citing factors like
increasing competition in the tablet industry.
The stock was amongst
the biggest percentage losers on the S&P. it dropped 5.2% to $545.56 at
some point when over 17 million shares had changed hands, putting it on track
to exceed the average daily volume of the company over 50 days of 21 million
shares.
The enormous size of
the stock implied the retreat was responsible for 2/3rds of the 1.1%
drop in the Nasdaq 100 Index on Wednesday.
Analysts gave
dissimilar reasons for the drop. Some even quoted a research report and said
that the company will lose share in the tablet-computer industry in the coming
year. Others quoted reports of upper margin requirements at clearing companies
and a number of shareholders said vague tax rates on capital gains in 2013
prompted sales.
Director at Performance
Trust Capital Partners, Brian Battle said that based on what happens with US
fiscal negotiations, rates could face a hike or they may stay the same. They
are not likely to be lower. Hence, an investor, who has seen profits in Apple,
can o ahead and take such profits this year itself.
Apple is still up 36%
so far in 2012, but it has been weak lately. The stock is down about 22% from
its all-time high of $705.07 per share of 21st September.
A Hudson Square
Research analyst, Daniel Ernst said that Apple stock is exceptionally more
unstable than its earnings stream.
He does not find any
sense in the instability since there are customers queuing up in front of the
company stores all over the world.
International Data Corp
said on Wednesday that Apple is likely to lose market share in the tablet-computer
industry for the entire 2012, with customers choosing Google’s Android over
Apple’s iPads.
Also putting pressure
is clearing firms are raising their margin requirements for positions due to
fears of being too heavily concentrated in the $526B company. One firm, COR
Clearing, raised its margin requirement to 60% from 30%.
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