AAPL After Hours: Share Price Slides On Tech Weakness

Apple stock dipped towards $120 per share once again, backtracking on a solid start to the week. This is your Wednesday "Apple Maven AAPL After Hours" report.
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On Wednesday, March 24, Apple (AAPL) stock slid 2.0%, after showing signs of having a pulse on Monday. Shares ended the day trading at $120.09, not far from where the stock stood at the end of last week

Apple is down roughly 8% since December 31, not the start of the year that investors had wished for. The stock has been lagging the S&P 500 in 2021 by over ten percentage points, as tech and growth stocks continue to underperform the cyclical sectors in a year of recovery from the pandemic.

Since establishing an all-time high in late January 2021, AAPL has corrected approximately 16% from about $143 per share.

Why AAPL headed lower?

The story has not changed much: Apple continues to suffer from a market-wide shift in attitude away from tech, growth and defensive stocks. There doesn't seem to be anything particularly wrong with AAPL and its FAAMG peers, other than:

  • Apparently, it is time for shares of banks, airlines and energy companies to shine 
  • Big Tech stocks rallied strongly in 2020, and probably need to catch their breath

What was particularly unique about Apple's decline this Wednesday was the continued pullback in interest rates. After the 10-year treasury yield reached a top of 1.74% in mid-March, it dipped back to 1.61% on March 24.

Lower interest rates tend to be good news for growth stocks like Apple, for reasons that I have highlighted in a previous post. This time, the magic did not work, and the Cupertino company's stock headed down towards the $2 trillion market cap level once again.

Here is how Apple's stock performed on Wednesday, relative to its FAAMG peers:

  • Facebook ended the day at -2.9%
  • Amazon ended the day at -1.6%
  • Microsoft ended the day at -0.9%
  • Google's Alphabet ended the day at -0.4%

Keeping the dip in perspective

I like to keep stock price movements in perspective, whenever possible.

While Apple investors might be disappointed in the stock's 2% move lower this Wednesday, a decline of this magnitude or worse has not been so rare in the past decade: once every ten trading sessions, on average.

Apple's daily returns since 2011

Apple's daily returns since 2011

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(Disclaimers: this is not investment advice. The author may be long one or more stocks mentioned in this report. Also, the article may contain affiliate links. These partnerships do not influence editorial content. Thanks for supporting The Apple Maven)