On Wednesday Apple Inc. cut its sales outlook due to weaker demand in China causing all markets to take a plunge
Apple Inc. cut its revenue outlook for its latest quarter citing slowing iPhone sales in China, saying on Wednesday it now expects sales revenue of about $84bn, down of about 5 per cent from their estimations of two months ago of $89bn to $93bn. This has caused Apple shares to fall by 7.45% just hours later after the announcement.
“While we anticipated some challenges in key emerging markets, we did not foresee the magnitude of the economic deceleration, particularly in greater China,” Apple CEO Tim Cook stated.
He also made a comment on Wednesday about “the trade tensions between the United States and China” and how they will also have an economic impact. This sent global markets plunging, led by tech stocks that slumped, while Chinese indexes fell almost 1%.
This is definitely a negative start to the new year for markets, after not a very good end of 2018. The currency markets also took a hit overnight sending the dollar, pound, and euro lower, and pushing up the yen. This is apparently due to investors that took Cook’s comments to heart and pulled money out of Western currencies and pushed them into the Japanese yen. Meanwhile, the Australian dollar saw a “flash crash” causing it to sink to its lowest level since 2009.
However, analysts say that this was also impacted by Apple’s high selling prices for its products, which can be as much as almost three times as expensive as products from similar vendors, like Samsung and Huawei.