Active Stocks
Thu Mar 28 2024 13:39:23
  1. Tata Steel share price
  2. 155.45 1.70%
  1. HDFC Bank share price
  2. 1,454.45 0.95%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
  1. ITC share price
  2. 429.05 0.25%
  1. State Bank Of India share price
  2. 755.05 2.86%
Business News/ Markets / Stock Markets/  Apple shares drop nearly 4%, erases $80 bn in market cap
BackBack

Apple shares drop nearly 4%, erases $80 bn in market cap

Experts said the drop is most likely temporary and is not surprising after a new iPhone is launched

Apple announced four new iPhones, besides an affordable smart speaker, the HomePod Mini. (AP)Premium
Apple announced four new iPhones, besides an affordable smart speaker, the HomePod Mini. (AP)

Shares of American technology giant Apple Inc. fell by as much as 4% intra-day on 13 October after the company unveiled its first ever 5G iPhone. The drop wiped off approximately $81 billion from the company’s market capitalization, as investors reacted to the new launch.

Experts said the drop is most likely temporary and is not surprising after a new iPhone is launched. Apple announced four new iPhones, besides an affordable smart speaker, the HomePod Mini.

“There are multiple reasons for it. Pricing of the new devices is one. The fact that Apple has left out accessories such as charger and earphones from the iPhone 12 box is another. In terms of features also, there are minor iterations with 5G being the only big upgrade," said Varun Kannan, research analyst, Canalys, a global technology analyst firm. “Even in terms of camera there is no huge upgrade. They have added new features like Lidar (Light Detection and Ranging) sensors, which might not appeal to all. However, this is a one-time fall and Apple will recover from this as soon as the iPads do well."

“The fall in Apple’s shares could be attributed to the overexpectations that the market had from the event, including in terms of product announcements alongside the iPhone 12 series," said Prabhu Ram, head, industry intelligence group, Cybermedia Research. However, he added that the iPhone 12’s features and the aggressive pricing for the HomePod Mini “marks its move in an uphill battle" against Google and Amazon in the smart home market.

Paras Jain/Mint
View Full Image
Paras Jain/Mint


Dan Ives, analyst, Wedbush Securities, had said earlier that the iPhone 12 will be the biggest seller since the iPhone 6 back in 2014. He was one among many who expected the company to do well.

Knee-jerk reactions from investors are quite common after Apple events. Usually, the stock remains flat or shows meagre gains when investors are happy with what they see, while drops are more significant when they’re disappointed. For instance, Apple’s stocks rose 1% after the iPhone XS launch two years ago, while falling 3% and 2% in 2016 and 2015, respectively, after the launch of the iPhone 7 and 6S.

Apple’s stocks dropped to below $120 during Tuesday’s unveiling, but started rising ($121.70) on Wednesday at press time.

prasid.b@livemint.com

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

ABOUT THE AUTHOR
Prasid Banerjee
An engineering dropout, Prasid Banerjee has reported on technology in India for various publications. He reports on technology through text and audio, focusing on its core aspects, like consumer impact, policy and the future.
Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 15 Oct 2020, 07:41 AM IST
Next Story footLogo
Recommended For You
GENIE RECOMMENDS

Get the best recommendations on Stocks, Mutual Funds and more based on your Risk profile!

Let’s get started
Switch to the Mint app for fast and personalized news - Get App

Chat with MintGenie