Apple stock fell on the first trading day of the year, weighing down the US stock market and snarling Big Tech’s gangbusters 2023 rally. In this post, you will get all the information related to the stock.
Asia’s Tech Market Shivers as Apple Faces Downgrade Impact
Shares of Apple suppliers fell in Asia on Wednesday, January 3, 2024 after Barclays downgraded the iPhone maker on concerns that demand for its products would remain weak in 2024.
During early trading on Wednesday, Jan. 3 Taiwan Semiconductor Manufacturing Company had a decline of over 2%. TSMC is a leading manufacturer of the most cutting-edge CPUs available, serving clients like Nvidia and Apple.
Foxconn, also known as Hon Hai Technology Group, a significant Apple supplier saw a 1.33% decline. Apple’s iPhones are assembled by Taiwan-based Foxconn, the largest contract electronics manufacturer in the world.
Technology and chip stocks tumbled more than 2% for Samsung Electronics and SK Hynix and dragged down 1.85% on the South Korean Kospi LG Electronics which sank 1.78%. Ray Wang of Silicon Valley-based Constellation Research “Street Signs Asia” said:
“We’re seeing that suppliers are still seeing robust growth on the iPhone 15. We’re in the middle of a supercycle.”
Wang told:
“There’s still 200 to 300 million iPhones that get replaced onto 5G, at least for the next 24 months, so I’m not sure exactly the downgrade on growth, but on valuation, I can understand maybe that’s where the hit will be.”
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Apple Faces Challenges After Barclays’ Downgrade
This Tuesday, January 2, 2024, Barclays lowered Apple’s stock rating and reduced its price target to $160 from $161. They pointed to lower sales of the iPhone 15, suggesting that demand for the upcoming iPhone 16 and other Apple products might also be lower.
As a result, Apple’s shares ended the day 3.58% lower on Tuesday, January 3. Analyst Tim Long said:
“We are still picking up weakness on iPhone volumes and mix, as well as a lack of bounce-back in Macs, iPads and wearables. The continued period of weak results coupled with multiple expansion is not sustainable.”
In a research published on January 3, UBS stated that TSMC was poised for a strong rebound in 2024 and upheld its buy rating, even though it had lowered its price objective from 760 Taiwan dollars to 750 Taiwan dollars. UBS said:
“We think TSMC is in a sweet spot for growth over the next 18 months from its very high share on 4-nanometer and 3-nanometer and leverage to builds on cloud AI plus positioned to benefit from any rise in edge AI lifting large endpoint markets of PC, smartphone and IoT.”
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