Apple Inc.’s stock prices took a sudden turn for the worse this week when CEO Tim Cook uttered a single phrase that spooked investors. The tech giant’s shares dropped 2.4% on Wednesday after Cook said the company was “seeing some macroeconomic weakness” in China.
The comment came during Apple’s quarterly earnings call, where Cook discussed the company’s performance in the third quarter of 2019. Cook noted that the company’s iPhone sales were down 17%, year-over-year, and that sales in China were particularly weak.
Cook’s words sent shockwaves through the market as investors scrambled to adjust their portfolios. Apple’s stock prices fell from $213.63 to $208.88 in the hours after the earnings call, wiping out more than $30 billion in market value.
The drop in Apple’s stock prices is the latest sign of the economic and political turmoil gripping China. The world’s second-largest economy is in the midst of a trade war with the United States, which has led to a weakening of both its currency and overall economic activity.
The effects of the trade war have been compounded by a series of other issues, including a slowing real estate market, a rise in corporate debt levels, and a contracting manufacturing sector. All of these factors have caused investors to become increasingly wary of investing in China, leading to a sell-off of Chinese stocks.
The sudden drop in Apple’s stock prices highlights the importance of China as a market for the tech giant. China is the company’s third-largest market, accounting for nearly a fifth of its revenue. As the trade war between the US and China continues to drag on, Apple will likely face further headwinds in the coming months.
Investors should also pay close attention to any further comments from Tim Cook, as his words can have a significant impact on the company’s stock prices. As the situation in China continues to evolve, Apple’s stock prices may remain volatile in the near future.