Apple results loom large for tech – and the market

“When Apple’s shares fall, is Wall Street’s entire performance at risk? The outsize influence of Apple on both the technology sector and the entire stock market was thrown into sharp relief when the iPad maker’s shares fell 4.1 percent on Monday,” Caroline Valetkevitch writes for Reuters.

“The alpha male of the stock market, Apple accounts for a third of the S&P tech sector’s 20 percent year-to-date return, the best performance of any of the 10 sectors in the Standard & Poor’s 500 index this year,” Valetkevitch writes. “The problem is, Apple’s success may be masking a larger trend in the wider market toward slower profit growth.”

Valetkevitch writes, “Technology companies are expected to report earnings growth of 7.5 percent for the first quarter, according to Thomson Reuters estimates. But excluding Apple, which is due to report results next Tuesday, the technology sector is looking at an earnings decrease of 0.3 percent, according to the data… Tech sector revenue growth is estimated at 6.7 percent. Without Apple? It’s just 2.3 percent, Thomson Reuters data showed.”

“Apple’s stock accounts for 4.5 percent of the S&P 500 index, a weighting not seen by any company since 1999, when Microsoft Corp had a 4.9 percent weighting,” Valetkevitch writes. “Apple is the largest holding for many money managers, to say nothing of the billions of dollars in index funds of which Apple is a core holding.”

Read more in the full article here.

[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]

Related article:
Apple to webcast Q212 earnings release conference call on April 24 – April 3, 2012


    1. BINGO. In the old days you could own a piece of a company (that you worked in?) but today its just a way to make quick money (millisecond trades??)

      But that does not mean that I do not want to ride the Apple train while its moving up the hill. 🙂


    2. @ enos33,
      I agree with the spirit of your comment, but would qualify it somewhat. While your comments apply to over 50% of the market, the ability to incorporate, and sell shares still provides innumerable benefits to businesses. In my opinion, the speed of trading should be slowed way down through regulation. I completely agree with your comments where they apply to high speed computer trading, which has no socio-economic benefit, and is detached from the reality of the actual, physical, successes and failures of the company.

  1. Canacord Genuity released a stupid note today – a half analysis that caused AAPL to slide. iPhone handsets have a seasonality in the United States. Yes, duh, we already know this. However, Tim Cook has adjusted Apple’s global iPhone 4S rollout so that there is a greatly reduced handset seasonality effect. MOOT STORY designed to short the stock for options expiration manipulation.

    How about the firm that releases the note is not allowed to trade for 2 hours after the note has had a chance to be rebutted?

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