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No blockbuster surprises: Why Apple investors are not blown away by iPhone X

Apple's shares closed volatile trading session 0.4% lower at $160.82 after rising as high as $163.96

Reuters 

Apple Shares
Phil Schiller introduces iPhone X. Photo: Reuters

Apple's shares closed a volatile trading session 0.4 per cent lower at $160.82 after rising as high as $163.96, after it unveiled its 10th-anniversary edition of the iPhone. Apple's release date of November 3 was later than some investors had expected.

The S&P 500 hit a record closing high for the second day in a row on Tuesday, with financial stocks leading the charge, but gains were stunted by a decline in Apple Inc shares after it unveiled its latest iPhone.

Nasdaq also clocked a record closing high despite weakness from Apple. Investors were more comfortable with riskier assets as concerns about US tensions with North Korea eased and the financial impact from Hurricane Irma appeared less severe than feared last week.

The financial sector was the S&P 500's biggest driver as bank stocks were helped by rising US Treasury yields, while the utilities and real estate sectors lost ground.

"It's a better environment for risk assets. As long as these two issues North Korea and the hurricane - have receded as concerns, it gives investors a green light to focus on stronger fundamentals," said David Joy, chief market strategist at Ameriprise Financial in Boston.

The Dow Jones Industrial Average rose 61.49 points, or 0.28 per cent, to 22,118.86, the S&P 500 gained 8.37 points, or 0.34 per cent, to 2,496.48 and the Nasdaq Composite added 22.02 points, or 0.34 per cent, to 6,454.28.

Concerns about Hurricane Irma's impact receded as it weakened to a tropical depression, while investors shrugged off fresh developments related to North Korea.

"A lot of it is the realization that the latest hurricane wasn't as devastating in the US as people feared," said Tim Ghriskey, chief investment officer of Solaris Asset Management in New York.

While some investors cited worries about whether Apple would face supply shortages, others said traders were just taking profits.

"There were no blockbuster surprises although what they're doing with the products is all pretty good," said Ghriskey.

The iPhone maker was the second-biggest drag on the S&P behind McDonald's, which fell more than 3 per cent on concerns about its third-quarter results.

Most of the 11 major S&P sectors were higher, with the telecom services index clocking the biggest gain with a 1.4 per cent rise.

Financials, the biggest driver of the day, rose 1.2 per cent, helped by a 1.8-per cent jump in the S&P Bank sub sector. Investors in banks, whose profits are boosted by higher rates, were reacting to a jump US Treasury 10-year yields to a three-week high after a 10-year note auction.

Also, Goldman Sachs unveiled a growth plan that could add as much as $5 billion in revenue annually.

The S&P Utilities and Real Estate sectors were the laggards of the day, with 1.8 per cent and 1.2 per cent declines, as investors shied away from interest rate- sensitive stocks.

Advancing issues outnumbered declining ones on the NYSE by a 1.71-to-1 ratio; on Nasdaq, a 1.70-to-1 ratio favoured advancers.

About 5.89 billion shares changed hands on US exchanges, above the 5.79 billion 20-day average.

First Published: Wed, September 13 2017. 09:10 IST
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