Stocks plunge after Apple slashes earnings forecast

Source: The Hill | January 3, 2019 | Sylvan Lane

Stocks tanked Thursday morning after Apple slashed its earnings forecast, citing an unexpected drop in global orders caused by trade tensions.

The Dow Jones Industrial Average dropped as many as 650 points Thursday morning, while the Nasdaq composite and S&P 500 index dropped 2.7 percent and 2.3 percent, respectively. A sharp plunge in technology and industrial stocks drove broad losses across the market in the first hours of trading.

Apple stock plummeted 10 percent lower Thursday morning, a day after CEO Tim Cook announced the company is now projecting first-quarter revenue of $84 billion after initially predicting between $89 billion and $93 billion.

Cook blamed Apple’s shortfall on the mounting costs of President Trump’s tariffs on steel, aluminum and Chinese imports, along with trouble in emerging market economies. His warning was the latest red flag to indicate a potential global economic slowdown.

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  • Consistent #27137

    Consistent #27141

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    EVERYDAY #27148

    Apple is not the only company to slash earnings estimates, but while these companies rightly blame Trump’s ill-advised trade war and a number of other issues — in Apple’s case, the main problem might be that the company has priced its products too high. $700 or so for the latest I-Phone is out of reach for many customers. So they are looking at their current old devices and deciding they are good enough for what they need. They are not going to shell out $700 for a new phone till their current phone gives up the ghost.

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