Apple's sales slowdown tugs Nasdaq index lower
NEW YORK — A sharp drop in Apple's stock pulled the Nasdaq down with it after the tech giant warned of weaker sales. Other stock-market indexes eked out slight gains.
Apple sank $63.50 to $430.50. With iPhone sales hitting a plateau and no new products to introduce, Apple said sales would likely increase just 7 percent in the current quarter. That's a let-down for a company that has regularly posted growth rates above 50 percent.
The Standard & Poor's 500 index edged up 0.01 of a point to 1,494.82. Earlier in the day, the S&P 500 crossed above 1,500 for the first time since December 2007.
The broad gauge of the stock market has already gained 4.8 percent this year and climbed seven days in a row.
One reason for the market's recent rise is that some of the biggest obstacles have been pushed aside, said Brian Gendreau, a market strategist at Cetera Financial Group. On Wednesday, the House of Representatives agreed to suspend the federal government's borrowing limit until May 19, allowing the U.S. to keep paying its bills for another four months.
“Politics is off the table for now and Europe seems like it's stable. So what's left? It's earnings. And aside from Apple it seems like pretty good news,” Gendreau said.
The Dow Jones industrial average gained 46 points to close at 13,825.33. The Nasdaq fell 23.29 points to 3,130.38. The 12 percent drop in Apple, which makes up 10 percent of the index, was enough to pull the Nasdaq lower.
Even after its recent slump, Apple still ranks as the world's most valuable company at $423 billion, putting it $7 billion ahead of the runner up, Exxon Mobil.
Many investors wondered whether shrinking sales would start to squeeze Corporate America's profits. Judging by the results so far, few are struggling.
Of the 134 big companies in the S&P 500 that reported through Thursday morning, 85 have beaten Wall Street's estimates.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Visual search still hampered by image issues
- States clear way for startups to use crowdfunding
- Deported migrants find home at call centers
- Healthy PA expands number of recipients but cuts benefits
- States fight back against financial scams aimed at seniors
- Students walk shop class path to excellence
- Google tests Project Wing drone delivery
- EDMC reaches debt-restructuring deal with creditors
- Lower your cable bill by streaming shows
- Fiat-Chrysler shares may hit market soon
- Hershey unwraps new corporate logo