Apple shares, U.S. stocks fall as results from GE, Microsoft disappoint; worry continues over Europe

“U.S. stocks fell, sending benchmark indexes toward their biggest declines since June, as Microsoft Corp. (MSFT) and General Electric Co. (GE) results missed estimates and euro-area leaders failed to discuss aid for Spain at a summit,” Inyoung Hwang and Nikolaj Gammeltoft report for Bloomberg.

“Microsoft slid 3 percent after the largest software maker posted earnings that fell short of estimates. General Electric lost 3.4 percent as third-quarter revenue missed forecasts. McDonald’s Corp. (MCD) slumped 4.2 percent as sales growth slowed at U.S. stores. Advanced Micro Devices Inc. (AMD) dropped 15 percent after announcing a plan to cut staff by 15 percent,” Hwang and ammeltoft report. “‘We had a group of earnings that were somewhat disappointing, especially on the tech side,’ Keith Davis, an analyst at Farr, Miller & Washington LLC, which manages $830 million, said in a phone interview from Washington. ‘There are obviously some very real risks out there, including the fiscal cliff, the U.S. election and the European situation. There are a lot of things that would argue for stock prices to be lower than they are right now.'”

Hwang and ammeltoft report, “A European Union summit failed to discuss further financial assistance for Spain, according to French President Francois Hollande. Germany and France agreed to enforce common banking regulation for the euro area’s 6,000 lenders by the end of next year… Apple Inc. (AAPL) slipped 2.5 percent to $616.60. Shares of the iPhone maker have fallen 12 percent from an all-time high of $702.10 on Sept. 19, driving the stock below its average price in the past 100 days for the first time since July. The shares are still up 52 percent this year.”

Read more in the full article here.

35 Comments

  1. It’s a global economy and most of the industrialized world has issues- not just the US. This is exactly why I have poured cold water on the Fanboi’s $1,000/share calls for Apple. People do not buy iToys when they are concerned about making the bills and basic job security. Some will, but not in the numbers Apple needs to show growth.

    1. Always always always, when I get into AAPL, it’s pushed down through no fault of its own. Today’s drop was f-ing ridiculous and unwarranted.

      Worse, analysts seem to have bumped up expectations deliberately ahead of Apple’s report next week, just so they have an excuse to say “Apple didn’t meet expectations” and drive the stock down further.

    2. Heh, that’s funny. I’m still up 52% for the year on my AAPL. Apparently, judging from Apple’s continued 30% annual growth through the worst recession in many years, people DO spend money on Apple products, even in a bad economy. Sell your gloom and doom somewhere else.

  2. And this perfectly illustrates how stupid the markets are sometimes. It should occur to any sane person that Microsoft’s numbers are down because of Apple’s impact on the post-PC world with the iPad.

    If the market — which basically just represents the excitement or fears of a mob — were wise Apple stock would go up when competitors are struggling. Instead, it’s assumed the entire segment is hurting. While this can happen, I don’t think it’s happening here.

      1. Googledoom is reeking with nepotism and sprinkle with hubris for aspiring to become THE government of the world. Ask Marissa why she left the sinking ship. At least Marissa has her dignity intact, but not Eric the Mole. He is still clinging to the useless, high-faluting title of Chairman of Googledoom.

    1. “Be greedy when others are fearful, and be fearful when others are greedy.”
      – Warren Buffet

      Depending on the company, a downdraft day like this presents buying opportunities for stocks pushed down by events not of their own doing. Earnings season is often a blunt instrument that punishes entire sectors, not just companies that miss their numbers. And that can create buying opportunities for astute investors.

      Nobody ever freaked out when Target announces a 20% off sale. But if a company whose stock is pushed down because another stock in the same sector is downgraded, investors should rub their hands at possible opportunities.

      Ignore the hysteria and focus on long-term trends, and the quality companies that shape those trends. If you do, and you’re patient, in the long run, days like today will be seen as a minute squiggle on a graph, and your investments will pay off. Handsomely.

    2. I remember the PPC days, when a bug in the intel math coprocessor made Microsoft stock drop.

      Strangely, AAPL’s stock went down AS WELL ! While Apple’s processors remained unaffected.

      Analysts, do your homework. Better yet, analysts without a tech degree should be FIRED. Or at least a tech degree should be required for future analysts who pretend to UNDERSTAND tech issues.

      1. I got out at the top. Have been putting some back in this week. Should’ve waited till today. Or Monday. But still way better than if I had held on. Stock is about $90 from where I sold. Great entry points now. A lot of upside. Never be a buy and hold investor. Always take your profit when you are way ahead. Then you just wait for a reentry point. Like now! For those buy and hold investors who did not sell at or near when Apple reached its all time high, they are going to miss all this upside coming. It’s not complicated. It’s not daytrading. It’s just basic investing. Good luck to all.

  3. This is why Apple needs to do a stock triple split to get the price to $200…,then all the Apple faithful and smaller investors could afford to get involved . This will lessen the impact of institutional investors that can manipulate the stock to their advantage. Right now only the rich can afford Apple stock. They can bring it down to $600, load up and watch the climb to $700 and higher and get richer ….. Apple could stop this nonsense with a split.

    1. Actually, the opposite would be true. A stock split can make it more volatile and thus easier to manipulate. Apple stock is not expensive. Based on its PE and PEG ratios, it’s strongly undervalued. It does not matter if you own one share at $618 or 3+ shares at $200 per share – the instrinic value is still the same.

      It’s fundamentally important that you understand that if you plan to invest.

      Spend time reading the works of Peter Lynch, such as his brilliant “One Up on Wall Street.” It’s a quick and surprisingly easy read filled with essential advice that can help the small investor. Let knowledge and patience be your best investment and your unfair advantage over the maelstrom of Wall Street. You can beat them at their own game if you do.

      Best of luck. And know that you can make your own luck. Just do your homework.

    2. Please stay out of the market because you have no clue what you are talking about.

      So, let me get this straight. You can afford buy up a bunch of $200 shares but not 1 at $600 and those who can are “rich”?

      If you can’t save $400 dollars without spending it over a a couple months, then you’ve got bigger problems or obviously are not great at making decisions.

      Apple is not responsible for your saving and investing habits or any of the nonsense that is going on in the market. It’s not Apple’s responsibility to fix the market or make you money. Target your retarded nonsense at the bankers who lent the money and the people who took it and bought shit they couldn’t afford to pay back or never even tried. We’re in this mess because of that very reason and it doesn’t look like the next 4 years are going to be any better then that last 4.

      Sorry, MDN. I’m just tired of stupid, lazy ass people who make bad decisions and everyone else needs to bail their asses out. Screw’m!

      1. To someone who earns minimum wage, $600 IS RICH. It’s all in the context of a person’s own financial position. Calm down and try being nice to those who are less fortunate than you.

      2. Actually a 3 for 1 split wouldn’t have much of an affect but a 10 for 1 split probably would. Splitting the stock makes no difference in its valuation but amateur investors would be more willing to buy at $60 than $600. The more shares held by ordinary investors the harder it would be for big institutions to manipulate the stock.

  4. It’s called a 3 for 1 split. I don’t think it’s happening. Apple doesn’t really need to do it. It’s not to their advantage. It would get a few more people in though.

  5. Pulled the trigger on some April 13 685 calls today. Bought April13 700 calls yesterday. It’s a hard trade to make yes, but I’m Hopefull they will be well in the money after the Christmas blockbuster quarter we are about to witness.

  6. Bears have been betting on an Apple earnings miss and gaining more confidence by the day as they watched intc, ibm, msft, goog, etc. miss their earnings one by one.

    The 64k question is how bad has the iP5 supply constraint been? Moderate or severe? I was betting on the former and added more at the low today. I buy more if it drops further next week.

    Guidance will be key this time which should be excellent given the pent-up iP5 demand and holiday sales. I sleep well buying at this level or lower.

    1. Absolutely. It’s all about guidance. Demand doesn’t mean anything if they can’t produce enough iPhone 5’s. And they have been having lots of problems keeping up with demand. For your sake and mine, let’s hope that guidance is good. Positive guidance should really help the stock rocket up especially from this point.

  7. IBM got the pessimism going but the Google miss started the trashing of the entire tech sector. I can understand Google getting hit hard because it has become obvious that the Motorola acquisition is going to be a disaster. Apple however is now in extremely oversold territory.

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