US stocks dipped on October 26 on the cue of Apple taking a tumble. The company is the biggest in terms of market capitalization and any changes to the company share sends ripples to the rest of the market. The Standard & Poor 500 dipped 0.2 percent or 3.73 points to scrape 2,193.43. Nasdaq Composite Index, dominated by technological companies, dropped by 0.6 percent or 33.13 points to end at 5,250.27.
The DJIA or Dow Jones Industrial Average defied the trend. This was due to the upward movement of Boeing Inc. The share value of the company went up due to its excellent earnings reports. The DJIA increased 0.2 percent or 30.06 percent to finally settle at 18,199.33.
Apple receded to $115.99, a dip of 2.3 percent. This is the company’s largest daily percentage loss in recent times. The last time it happened was in September 9. Apple stock was punished by investors after the company declared that its quarterly earnings have beaten expectations by a little margin and revenue was not as robust as expected. There is a possibility that investors did not appreciate the confession by Apple that the current quarter can be hard for the company and it was not bullish as expected.
According to Michael Binger of Gradient Investments LLC, the quarter by itself was not bad, but can best be described as lukewarm. Binger is the senior portfolio manager of the company and his company has stocks in Apple too.
Windows of opportunity
Not all people are afraid of stock prices dip. Amit Daryanani of RBC Capital Markets LLC is of the opinion that such a selloff will help investors to purchase Apple stock. The fundamentals of the company continue to be the same. The not-so-good results of Apple have completely blanketed the good news from Boeing. The latter went up by 4.7 percent in Dow, Incidentally both Apple and Boeing are found in Dow.
Most indexes opened low but the market recovered later. Energy stocks pushed the markets up until the momentum was lost. December West Texas Intermediate crude dipped 1.6 percent. The bounce in the oil markets happened after it was reported by Energy Information Administration that there was an unexpected slide in the domestic crude supplies during the last week of October. This is positive for a market struggling with oversupply. Gains in the financial sector of the S&P 500 compensated a few of the drops in consumer sentiment.