Apple stock losing safe haven allure amid AI, China headwinds
For years, investors have viewed Apple stock as a potential safe haven during periods of market instability. However, that perception has not held true in the current climate. Late-to-AI Apple has experienced significant declines in recent trading sessions, worsening its year-to-date underperformance as a mounting array of risks overshadows the company’s historically strong positives.
Ryan Vlastelica for Bloomberg News:
While Apple offers steady earnings growth and sits on a mountain of cash, headwinds form a daunting list for would-be bulls: it is heavily exposed to tariff uncertainty and China, its artificial intelligence offerings have repeatedly fizzled, and its lucrative partnership with Google parent Alphabet Inc. is potentially at risk. It trades at a premium to megacap tech peers despite slower revenue growth, suggesting that the haven case is harder to make for Apple.
“People like to park in Apple, but right now the stock is expensive, and not only is growth slow, but the catalysts for growth are absent,” said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder. “It doesn’t seem like AI is doing much for it, the environment is very uncertain, and it is very at risk with tariffs and China… [I]t seems like it is just treading water, and it has been a while since we’ve seen anything truly innovative from it.”
Shares have dropped 13% this year, and are coming off their biggest three-day decline since November 2022, a selloff that took the stock to its lowest close since September. The Nasdaq 100 Index is down 6.7% in 2025, and Apple is responsible for nearly a fifth of that decline, according to data compiled by Bloomberg.
Investors had been optimistic that the iPhone 16, the first to be compatible with AI features, would entice consumers to trade up for the latest model. However, demand has underwhelmed so far, and in the latest example of its struggles with the cutting-edge technology, it is indefinitely delaying the release of its AI-infused Siri digital assistant.
MacDailyNews Take: We thank the overreacting market for this early 2025 gift. More, please! Let’s see sub-$200!!!
This too shall pass.
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