Stock Story -
What Happened?
Shares of iPhone and iPad maker Apple (NASDAQ:AAPL) fell 3.6% in the morning session as the major indices declined (Nasdaq down 1.8%, S&P 500 down 0.9%) amid rising geopolitical tensions in the Middle East. NBC News reported (citing White House and Defense Department officials) that the U.S. "has indications that Iran is preparing to imminently launch a ballistic missile attack against Israel."Separately, Fed Chair Jerome Powell told investors there is no "preset course" regarding the pace of future rate cuts. He added in a speech delivered to the National Association for Business Economics, "Looking forward, if the economy evolves broadly as expected, policy will move over time toward a more neutral stance. But we are not on any preset course." While the markets could still be right about more rate cuts in the near term, Powell's comments added uncertainty to both the cadence and magnitude of cuts.
Following these updates, the VIX index (or fear gauge) spiked as the reports created more uncertainty, which investors certainly don't like.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Apple? Find out by reading the original article on StockStory, it’s free.
What The Market Is Telling Us
Apple’s shares are not very volatile and have only had 2 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.Apple is up 21.1% since the beginning of the year, and at $224.76 per share, it is trading close to its 52-week high of $234.82 from July 2024. Investors who bought $1,000 worth of Apple’s shares 5 years ago would now be looking at an investment worth $4,003.