Apple shares dip on first China Mobile iPhone day

“Apple (AAPL) fell 2.45% to $540.67, down $13.58 from its previous close of $554.25, at the close of the trading day on Friday, the first day that customers in China could start to buy iPhones through China Mobile,” Andrew Meola reports for TheStreet.

“The stock had a volume of 13,412,681, slightly above its average of 11,419,200. It hit a high of $552.07 and a low of $539.90 for the day,” Meola reports. “Apple CEO Tim Cook made a special surprise appearance at the opening of a store in Beijing to mark the occasion. Journalist Jahangir Naina posted a series of photos on Flickr to document the iPhone introduction, which shows crowds of customers at China Mobile stores lining up for the product.”

“Cook indicated Wednesday that the company plans to strengthen its ties with China Mobile in order to grow in the world’s largest smartphone market by shipments. The deal, which took six years of negotiations, finally allows Apple to offer its iPhones through all three of the China’s state-run carriers,” Meola reports. “TheStreet Ratings team rates Apple as a ‘buy’ with a ratings score of A+.”

Read more in the full article here.

Related article:
Timing of Apple earnings has some options traders nursing losses – January 8, 2014

52 Comments

    1. A latte machine would quickly run down the iPhone’s battery, so of course, Apple shares would drop. No matter what Apple does, there will be much negativity about it. It’s getting to the point where I can’t even imagine a scenario where Apple comes out favorably. Simply running a successful, solid company isn’t good enough anymore.

      You’ve got J.C. Penney practically on the verge of bankruptcy and yet it has 84% institutional ownership. Why aren’t they running for the hills?

  1. I don’t get it. Why is the stock down? The product is selling like gangbusters, Apple just added a huge segment of new potential customers, they’re reporting record sales and profits, and the stock goes down. WTF, does something seem amiss?

    On the other hand, there are all sorts of issues, problems and dropping sales of Android derivatives, and their stock value keeps skyrocketing. Is somebody messing with my head?

        1. Can someone explain to me why option or hedge funds traders don’t manipulate other stocks with this degree of success, my understanding was the dividend and buyback would curb this behaviour–i’m very close to selling my entire position of Apple, simply put i cannot deal with the poor stock performance any longer–any advice would be welcome ??

          1. One word: Integrity. Apple has it, the rest don’t. I don’t know if you’ve been following what’s been happening in the United Hates over the last few years but their empire is crumbling faster than a pair of twin towers.

            It you are not in it for the long haul sell for that short term gain, and ignore that long term pain.

            If you believe that justice, integrity, morality will prevail, then hold the course. The dividends are great by the way.

            I’ve anticipated this myself, and Apple going from $700 to $400 over the last year after Jobs died is on no surprise. The bet right now is if the legacy is of the spirit or of the man. That’s the big gamble. I’m gambling that over the long run Apple will prevail, humanity will prevail, but it’s going to get ugly, very very ugly until that light shines. These are dark and interesting times, but most empires crumbling show these characteristics.

          2. Traders don’t manipulate to the degree people are suggesting. Clearly the deltas increase as the price approaches the strike.
            I’m afraid the share price for a company like Apple is not based on earnings but future earnings. I’m short APPL and expecting a pullback to sub $400 during Q3.
            Personally not worried about Samsung but the entire low end mkt. Star, Canvas, Asus, Motorola etc. It’s had to justify spending 300 – 500% for an iPhone. Clearly an iPhone has better specs but I’m typing this from a 4s and it does a fine job but I can buy a phone with a faster processor, screen approaching retina display 4.5/5″ display for $120.
            Mkt share not looking great I’m afraid.

    1. Because profits have very little to do with stock price anymore. MANY years ago, company performance was the principle determinant of stock price. Today, most of the price fluctuations are driven by option trading, which has nothing to do with performance and everything to do with manipulating a stock’s price to go up and down. Hedge fund managers make their money when a stock moves in price in the direction of their bet. Apple is big and obviously can easily have it’s stock price manipulated. If we didn’t have hedging, there would be much more stable stock pricing, but a lot less total money in the market.

        1. At last, someone who understands!!
          Clearly you have options but the net open interest is negligible vs total shares.
          I guess most if the commentators here have no real clue how it works.
          Let’s take 550 strike. You have both puts and calls on this value so to really dumb it down as the calls move into the money the puts come out.
          Look at the NET open interest, work out the delta and gamma and you see total push towards the strike.
          Clearly the delta explodes towards the strike but equally remember you only buying the right to go long/short at the strike. If I push the mkt lower from 555 to 550 my option just get me shorter at 550. 13 million shares traded a day… work the numbers.
          Big picture these variables are noticeable but essentially noise, the fundermentals will 6 months hence.

      1. Isn’t there any way Apple can fake these dudes out or is it really just the end for Apple as a money-making investment? Can institutions really make much money by running FaceBook and Twitter up $20 in a day. They’ll never make that type of revenue in years. All I know it seems like Wall Street is just one big casino game and I really fear for the U.S. economy if that’s how things work.

    2. Financial engineering. Get stocks propped up thanks to speculation, then whenever there’s good news, try to make people sell, so as to acquire their shares cheaper for traders to prop up again through speculation.

      Done ad infinitum, this can be much more and more quickly profitable than sitting on shares until their value rises considerably.

    3. Seems like the same old standard buy on rumor sell on news, method to me. When new products, services, business deals are talked about the stock starts to creep up. Once the announcement is made, there’s a sell off, the stock price drops and the cycle starts again.

    1. Why are you all surprised? This always happens to Apple without fail! Good ol’ market manipulation rules O.K! I wonder why I thought they had done something about reigning in those rogue investment banks??? 🙁

  2. Well, it’s nice someone woke up from their Apple dirt nap. Of course, Apple is down. How long has Wall Street been saying that no one in China can afford iPhones, so how is today’s drop a surprise? For Apple shareholders, it’s one step forward and two steps backwards.

    Just like while Nero fiddled, Rome burned, Tim Cook playing footsies with CEO Xi of China Mobile, Apple is starting to catch fire but in the wrong sense. Everything and I mean everything Tim Cook does sends Apple stock lower. Buybacks, dividends, new contracts send Apple sliding while everyone stands around saying Apple stock is heading for the moon. Apple is no Google and certainly no Amazon. When Apple misses the stock plummets.

    OK, I’m being unfair to Apple by saying Android is killing Apple’s share value but since everyone says Android isn’t harming Apple at all, I guess I’m just plain crazy. The fact is Apple is down 13 points today and Tim Cook is dancing and celebrating in the streets of China just makes me even crazier. Wall Street rings up another one:
    China Mobile + Apple iPhone = No sale

    1. You are spot on–i share your frustration as a large Apple shareholder, will be lightening up my position significantly closer to earnings, cannot stomach this stock anymore and the pure manipulation–way too frustrating they won, will likely buy Google and more BAC/Facebook seriously disappointed

      1. I am not the one manipulating the stock lower–only an individual whom would like a reasonable return and a reasonable P/E on a great company, however I am not naive to believe that this pattern will not continue all the while less successful / profitable companies stock rise will much less merit. Think, read and pause before you vote folks.

  3. Wait till the numbers come in and again the idiots on wall street will be made to look like lobotomized donkeys and then they’ll start crying like little babies that Apple sandbagged them…

    They all ought to go back to the garbage disposal companies that they came from…

    1. @ breeze, Have you tried asking Hyaena’s to stop scavenging?
      Did they stop?
      Well, your comment is about Wall Street is akin to my question above. i.e. You can take the garbage out of the Hyaena, but you cannot take the Hyaena out of the garbage!

          1. Do you still have an arm Mac Plus?
            I bet, you had to be pretty nifty to avoid the pig snapping your arm off but perhaps your lipstick got eaten?
            Here is a thought… Cut the pigs head off first, then apply the lipstick and or an apple as in the fruit apple and not the computer! 🙂

            1. Arm’s still here. Baby pigs can’t open their mouths wide enough to bite off arms- fingers, yes.
              I must confess, while we did raise some pigs, and we did play with the piglets, we never actually put lipstick on them – luckily for me it never occurred to my sister that we could have.

            2. You are a hoot Mac Plus!!
              Had a friend who dabbled in pig farming, his sow learnt that if it was patient a hen would invariably pass nearby and it would snap its head and grab it. After about 15 chickens had been lost this way, the final one got its own back. When the sow lay down to suckle its piglets, the chickens bones perforated its insides killing it where it lay. It took a day before the piglets realized no food was forth coming and a day for my friend to realize what had happened.
              As delicious as pork can be, its downfall is that pigs can be carnivorous and even cannibalistic in the case of a dead pig in the pen amongst other pigs.

  4. Well this isn’t totally unexpected, the stock climbed on the buildup to the announcement, and now all the quick money is taking their profits before the buildup to the next Quarterly earnings statement a which point Apple will drop again when the hedge funds again take profits.

  5. Please Apple buyback stocks now while they are down. Buy them from the ass wipes that are willing to trade them today, and retire them, taking them out of the hands of the idiots. Keep doing this until AAPL stock is only owned by people who deserve to own it. Then increase your dividends.

  6. Fuggedaboudit. This is classic Wall $treet “Buy on the rumors, sell on the news” BS.

    This is but one day in a continuum. Don’t be a trader, be an INVESTOR. And being an investor means having patience, ignoring BS articles like that POS drivel that ran in the NY Times today (likely written and filed BEFORE iPhones officially went on sale today via China Mobile) or anything by Business Insider. It means drowning out the noise from CNBC and just about any pundit we can imagine. And it means ignoring a single day’s events.

    If you are an investor, not a trader, you invest for the long run. If the stock whose shares you own pays a dividend, you reinvest it. And you wait. Over time, the company’s cash flow and earnings grow. Your dividends reinvest and multiply as additional shares. And years later, you look at your brokerage statement, and surprise! You see that something magical has happened.

    Think of investing like planting a tree from a small sapling. You can water it, fertilize it, sometimes, you might need to prune it, and enjoy watching it grow. That is what you should do with an investment in a company like Apple. Trees, like great companies, do something interesting: if you stand back, over time, you will watch the little sapling grow into a mighty tree.

    That’s what the short-term traders on Wall Street or pundits like Henry Blodgett will never understand. They expect that by yelling at a tree, that it will grow faster. But a tree doesn’t care. It can’t hear anyone yelling at it, and if it could hear, it would ignore you. And well it should.

    So think of your good investments like you would a grove of trees. Let them grow peacefully. Some years from now, they will astonish you with towering majesty. That day will come. But you must be patient.

    So go outside. Get a life. Your investments will be waiting for you a week, a year, a decade from now. Ignore the noise. Sit back and watch your trees grow.

  7. The daily news is killing Apple. Everyday there is negative Apple news like taking kids money for apps, fighting the courts over this or that. On the other hand, we learn Google is curing diabetes , driverless cars, ferry boats and buses for employees. We cannot win, just too many Apple haters. Add the stupid analysts and AAPL is facing an uphill battle. Maybe Apple needs to work on a more positive image, hoarding money offshore and keeping their plans secret just turns many folk off.

  8. Everyone, please consider a slightly different angle to this, and don’t worry. (I work “near” wall street)

    There were over 50,000 option contracts for apple that expired today that were not worthless (e.g. 40K on $500). Everyone tends to harp on the options that ended up worthless (E.g. the over 30K at $550), but there are very very many that are not worthless.

    Simple math dictates what happened. Every option is good for 100 shares. About 50,000 in the money options = about 5,000,000 shares. These people were selling those shares to capture their financial gain.

    The stock will move up next week.

    1. Apparently you need to be nearer to Wall Street. Your options comments make no sense. Options expire in the money and worthless every week. That’s not news. That’s not a new discovery. That’s not manipulation. Water is wet.

      1. If you’re going to take a shot at me, at least be more accurate or make are useful comment. My comments make actual sense.

        January 18th is date that annual options expire, called leaps, which often trade in, relatively, very large volumes. It is well documented that Aapl declines around the major january option expire date.

        The extra volume, which I commented on, is what is causing the big swing. You are correct that water is wet (I’m very proud of you for figuring that out), and that it’s not manipulation.

        What it is though is a significant annual event, which, given the timing of 1st quarter results pending and the China Mobile deal, makes the market swing seem suspicious or whatever you might believe. But it’s not suspicious, it’s not manipulation, it’s normal buy and sell activity.

  9. It happens almost every Friday. The option markets keep massive amounts of call positions to defraud investors. They’re laughing their butts off as it’s all rigged.

    1. It amazing that options are allowed. It’s obvious when there is a fixed time for expiration and a price for making the most money that those in control can collect a safe profit.

  10. Who writes these article ?. Wow.

    2 things..
    1st ..it is weekly option exeration,.. Max pain at 435… So no wonder !
    2nd it is experaition of leap options… ( if u dont know what this is google it )

    This move own has zero to do with what happend to apple as Company or china or anywhere! Or buy rumore sell news! Nada!
    If u are in apple u are here becouse u belive in 2014 being a magical year for apple.. Not jan 17 th .

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