The PowerShares QQQ Trust (NasdaqGM:QQQ) and a roster of other
were trending lower Thursday as Apple stocks slipped around 10
percent on disappointing iPhone sales.
The Apple sell-off was sharp enough early in the session to
trigger stock exchange circuit breakers, which are designed to
manage selling pressure of stocks in decline. The Cupertino,
Calif.-based company's latest earnings report showed holiday-period
iPhone sales didn't meet analyst expectations, fueling concerns
that the tech giant might be losing its dominance in the smartphone
The hit on the firm's stock price, which came despite record
quarterly earnings of around $13.1 billion, added to what is now a
34 percent decline since the company's shares were at a 52-week
high four months ago. Apple's shares, which were trading at $461.20
this morning, closed at $702.10 on Sept. 19 of last year.
Apple is a major holding in many tech ETFs, though it's worth
noting that different funds have different Apple weightings, which
means they are being affected quite differently by the slide in the
tech bellwether's shares.
The most conspicuous of those is the $33 billion QQQ, which
tracks the Nasdaq-100 Index and allocates more than 15 percent of
its portfolio to Apple, making the company the fund's largest
holding. The fund was trading 0.65 percent lower Thursday, and has
declined 5 percent in the same four-month period since Apple stocks
Other tech ETFs, such as the Vanguard Information Technology ETF
(NYSEArca:VGT) and the Technology Select Sector SPDR Fund
(NYSEArca:XLK) were seeing similar price action.
Interestingly, the First Trust Nasdaq-100 Equal Weighted Index
(NYSEArca:QQEW), a fund that tracks the equal weighted Nasdaq-100
index, was one of the only tech ETFs to be beating the trend. QQEW
was in fact tagging on gains of nearly 1 percent Thursday, forging
new record highs as it neared $28 a share. The fund, however, is
small, with only $95 million in assets.
The broad stock market also seemed relatively un-phased by
Apple's troubles. The S&P 500, in fact, hit a five-year high in
early trade, crossing through 1,500 for the first time since
The SPDR S&P 500 ETF (NYSEArca:SPY), the largest ETF in the
world, with some $125 billion in assets, was rising 0.4 percent
Thursday to near $150 a share, its highest level since October
The fund has rallied 102.7 percent in four years since it
bottomed in February 2009 around $74 a share. SPY allocates some
3.5 percent to Apple.
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