BUSINESS
Why has Apple lost $200 billion in two days? Will the stock continue to fall?
Shares in the world’s biggest company collapsed on Thursday on the news that their products would be banned for use by Chinese government officials.
Apple, the American tech giant, suffered its second big drop in stock price in as many months as news from China threatens to derail the company’s expansion into the world’s biggest market.
The share price has fallen by 5.3% since last Friday, nearly $200 billion worth of stock market value, with the news that Chinese government workers have been banned from using iPhones. China contributes around 18% of the companies annual revenue.
The Wall Street Journal (WSJ) reported on Wednesday that the Chinese government had ordered central government agency officials to stop using Apple devices for work. It has also been reported that the ban could be extended to companies that are supported by the government.
Some analysts believe that the timing of the ban is linked to China’s domestic phone industry. Huawei, a phone company competing with Apple, released their new model of phone last week. The Huawei Mate 60 is made with technology that the US government thought was impossible to manufacture after bans in 2019.
Will the stock continue to fall?
On Friday the stock market price for Apple increased by 1%. In the last year Apple’s value has increased by 43% and has the launch of it’s new iPhone next week.
In a recent note to clients, JPMorgan managing director Ron Adler told investors that Apple stock usually rallies leading up to its events before dropping off. With stock prices at multi-month lows, the price could fall further in September before rising again before Christmas.