“Another washout overtook Wall Street Thursday, sending major averages down as much as 7 percent as traders bailed out of the credit-battered stock market,” Jeff Cox reports for CNBC.
“The market’s afternoon selloff sent the Dow below 9,000 for the first time in five years, as unshakeable fears from the credit freeze combined with the expiration of short-selling rules to beat down stocks for the seventh straight day,” Cox reports.
“Selling grew downright feverish in the final hour as exasperated traders described an air of hopelessness and questions circled over what the market’s capitulation selloff point might be,” Cox reports. “The Dow roared past a 6 percent loss, with the worst damage coming in areas with any connection to the financial sector, though all 30 issues in the bluechip index fell. The index was off 37 percent from its all-time high a year ago today.”
“Technology shares, which had been helping to salvage an otherwise lackluster day in which banks and automakers languished, were the least hard-hit but still heavily damaged,” Cox reports.
“Nasdaq leaders Apple, Research in Motion, and Microsoft helped temper losses as the tech gauge fought for higher ground through most of the day. But even they couldn’t withstand the selling tsunami that enveloped the market,” Cox reports.
“A pair of economic reports had little impact on markets; both weekly jobless claims and natural gas inventories were in line with estimates,” Cox reports.
Full article here.
I’m looking at all this with a mixture of fear and, at times almost expectant astonishment.
Given the massacre in the market today, AAPL showed good relative strength. It’s gotten battered along with the general market recently, but it has sterling fundamentals and a very bright future: All three major lines are doing well (iPods, iPhone/iTouch, and computers), it has zero debt, and roughly $22 billion in the bank (which is especially crucial in a credit crunch). I’m not saying it’s the world’s greatest investment right now, but, when the market eventually recovers, it will probably be among the earliest and quickest to recover.
This is the fire sale to beat all fire sales. I am scraping together every last penny I can get my hands on to invest more in AAPL stock.
Here’s a wild ass guess:
If Apple manages to pull a good (a little above guidance from Apple) first quarter (Christmas Quarter) while most others tank hard. We could see AAPL fall below $50.00 (provided the Stockmarket drag it there on it’s own.
If Apple does an ok (inline with Apple guidance) we could see it drop one to 2 percent.
If Apple did less then ok (dropped below Apple guidance) we might see it go up one to 2 percent.
If Apple does very poorly the AAPL price might fall to below $50.00 too.
If Apple defies the economic odds, the analysts, punter, flogger, bloggers, doggers and press and has another record breaking quarter AAPL might just start a slow but, upward trend again.
Demon,
your message is a bit confusing and a bit illogical; you are saying that AAPL would lose half of its value if it did well (above its guidance) in Christmas quarter (which it will report in January), and it would gain 2% if it just met its guidance. This makes little sense.
Here’s what I thing about the upcoming ER (12 days from now). Apple will comfortably exceed its guidance, which is already expected from everyone. It will also exceed the Street expectations. This won’t affect the stock, however. Ever since they begun giving guidance (about two years ago or so), they’ve been comfortably outperforming it. They’ve also been outperforming the analysts’ estimates as well. However, almost every time, AAPL would tank after ER, due to their conservative guidance for the following quarter.
My hope for this October’s ER is that Apple would do what they did last October: provide surprisingly high and robust guidance for the December quarter. That is the only way we could see AAPL go higher from the sub- $100s we’re seeing now.
As for January, we’re still too far from there. If last year is any indication, we just my as well sell all again in November.
10 months ago people were calling for AAPL to break $600.
From MacObserver.com:
December 28th, 2007
Apple has gone from “beleaguered” to Wall Street’s darling, and analysts are expecting even more from their love affair. Following Georges Yared raised his target price for Apple’s stock to US$300, Daedalus Capital’s Stephen Coleman predicted that the Mac and iPod maker will hit $600 in 18 months, according to the Bloomberg.
Why does “conventional wisdom” hold that price trends on anything will keep snowballing in their current direction? (Home prices in 2006 being another painful example)
AAPL could be a great buy now… if you have the stomach for it. They could very will hit $50 if things get ugly enough. They should take off very nicely when things improve, but as always “when” is the key factor.
Any UK readers of this page own APPL shares and can recommend where to buy them?
With the price down, I’m very tempted to buy a few now (though I wish I’d bought some when they were down in the $10-15 range back in the early 90’s…)
Bartsimsonhead:
AAPL stock was in the $10-15 range as recently as 2003. In other words, it grew 15x in 5 years (over $200), coming down to about less than half of that all-time high, some 10 months ago.
For online brokerage in UK, go to Google, type “online stock trading UK” and you’ll get many: E*Trade UK, Barclay’s Stockbrokers, Interactive Brokers… Commissions are around £7 – £12, depending on brokerage, what types of securities and how often you trade.
Death to short sellers!
I fully expect the DOW to go as low as 7200 before all is said and done.
@ Bartsimpsonhead
I am not a Briton, but I have lived in the UK for five years now. I bought mine through HSBC’s InvestDirect service. It takes 3 days to move your £s out of your personal account into InvestDirect, but once you decide to buy or sell or put £s back into your personal account it is faster.
@ Bartsimpsonhead
I use Hoodless Brennan, based in Docklands. They have an excellent on-line trading system ( Mac friendly of course ) and their fees are modest.
@Predrag
you are right it doesn’t make sense but, this is want my predictive models show would happen. Each time Apple has announced results that didn’t blow the guidance out of the water shorting AAPL beat the stock down by 10 to 25% and in volatility currently in the market the model shows it could be much lower in the $50.00 range based on todays price.
Blowing Apple’s guidance out of the water the buyers out number the short sellers and the price starts and upward trend.
The guidance and a little less the short sellers tend to shy away in fear of loosing their shorts from a normal sell off.
Don’t get me wrong Apple is in the perfect position to come out of the economic and stock market downturns in a much stronger position then almost any other computer/electronics companies.
Once the market gets the Bear off it’s back and the Bulls return Apple breaking $200.00 is an almost guarantee and $300.00 is not out of the realm of possibility.
AAPL stock was in the $10-15 range as recently as 2003. In other words, it grew 15x in 5 years (over $200), coming down to about less than half of that all-time high, some 10 months ago.
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Dont forget that it split, so it actually grew much more than that.
Bart,
Lots of online services available – you have to fill in a US tax form before you can invest, but that just takes a few days. I use iWeb share dealing – they’re good.
I would treat any stock market investment now as a gamble – really no different to putting money on the favourite in the 2.30 at Haydock Park. (Except that you’ll probably get your money back in the end, if you wait long enough. And… OK, so it’s nothing like betting on a horse, really.)
Anyway, my bet is that Apple isn’t staying below $100 much longer. Even if it took a whole year to get back there, that’s still more than 10% pa profit – not bad, and it could be a whole lot better. In the end, once the market panic is over and credit starts moving, the market will have to reflect company fundamentals better than it does now, and Apple’s are strong. Even if you think that Apple’s price has been ‘unfairly’ manipulated (I don’t), that can’t carry on forever.