Premarket: Apple is red

From CNBC's "Stock futures slightly negative Wednesday morning" posted early Wednesday:

Stock futures were just under the flatline Wednesday morning...

In regular trading the Dow fell more than 350 points, or 1.03%. The S&P 500 and Nasdaq Composite lost 1.4% and 2%, respectively.

The moves came as investors lost hope that the Federal Reserve will be able to engineer a soft landing. Instead, concerns swirled around the state of the economy and whether an economic downturn is approaching.

“Investors couldn’t decide which they were more worried about: an impending recession, as implied by November declines for the ISM, Chicago PMI and Philly Fed, as well as housing data, or the threat of a more hawkish-leaning FOMC, as a result of stronger than expected employment data and factory orders,” said Sam Stovall, chief investment strategist at CFRA Research. “Stocks sold off across the board, as investors decided to take the profits generated by the last two monthly price gains, the first since August 2021.”

Investors await more economic data this week for clues on what to expect from the Fed. On Wednesday, the Mortgage Bankers Association will release its weekly report of mortgage loan applications.

Charts: Yahoo!Finance sees a bullish MACD pattern. Max pain moves up $1 to $147 with a call mountain at $150 (down $5) and a put peak at $135.

6 Comments

  1. Robert Paul Leitao said:
    Apple remains under pressure in early Wednesday trading as market attention turns from the recent lockdowns in China to next week’s FOMC meeting, the prospect of higher interest rates and the risk of an economic recession. The shares are currently down $1.59 or 1.11% at $141.33.

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    December 7, 2022
    • Robert Paul Leitao said:
      In afternoon trading Apple’s shares are currently changing hands at $140.90, down $2.01 on the day. As previously noted, Morgan Stanley has again reduced the firm’s iPhone unit sales numbers for the December quarter. Of note today Apple has announced an enhanced encryption system to protect iCould data. The WSJ and other news outlets are covering the story.

      1
      December 7, 2022
      • Robert Paul Leitao said:
        Apple ended Wednesday’s trading session off $1.97 or 1.38% at $140.94. The shares continue to trade above the most recent low on November 4th of $134.38 (which is also the most recent ex-div date) and well above the 52-week low of $129.04 set on June 16th.

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        December 7, 2022
  2. Robert Paul Leitao said:
    According to Barron’s, Erik Woodring at Morgan Stanley has again reduced the firm’s iPhone unit sales estimate for the December quarter. I’m placing a link to the story by Eric Savitz in the Apple Share Price Performance channel of the Apple 3.0 Slack group for easy reference by subscribers. I recommend reading the story. For now the analyst is not revising the firm’s March quarter unit sales estimate though he believes it is more likely demand will be deferred rather than destroyed.

    1
    December 7, 2022
    • Bart Yee said:
      Importantly, Woodring suggests due to reduced iPhone supply overall revenue estimates cut to about $120B, compares now turn slightly negative -3.1% to YOY $123.9B. That would still be the second highest

      To me, that would imply other segments to be flat to slightly higher. I would think iPads flat, Macs flat to slightly higher despite no new products, iPhones down $3-6B, Wearables up 5-12%, and Services up 3% exceeding $20B for the first time. All of this despite about 700-800 basis points of Foreign exchange headwinds.

      My hope is that all analysts revise their total revenue numbers down to account for an iPhone shortfall, making any expectations more realistic. Apple and AAPL doesn’t need unrealistic expectations to be compared with as if nothing untoward had happened.

      2
      December 8, 2022

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