From Kriti Gupta’s “Apple Is Plunging and a Weaker Dollar May Be the Savior It Needs” posted midmorning Monday on the Bloomberg:
Apple Inc. just suffered its worst week since last February and is down again Monday. What can reverse this trend? If history is any guide, look for a weaker dollar.
The tech giant hit a $3 trillion market capitalization on Jan. 3. Since then, the stock has lost 13%, while the S&P 500 has lost 11% with mega-cap tech shares taking a beating. The correlation isn’t new. Each time Apple’s market value has hit a trillion-dollar milestone, the broad market gauge has entered a technical correction. And a dollar slump has been the key to turning it around.
When Apple first reached a market cap of $1 trillion in August 2018, it sparked a 20% technical correction in the S&P 500. It happened again two years later, as it breached the $2 trillion milestone and then helped fuel the tech wreck of 2020. Obviously, other factors have played a role, like Federal Reserve decisions and macro economic developments. But there is no mistaking Apple’s role as a stock-market bellwether…
The point being, keep an eye on the dollar. As it weakens and gives foreign investors more incentive, the S&P 500 is likely to reverse the selling that has thus far marked 2022. And history says big tech, including Apple, will play a significant role in that.
My take: Apple doesn’t need saving. The stock will take care of itself.