Apple stock falls for fifth straight day, as investors worry about China, future iPhone sales

Industries Associated Press

Apple is slumping as the usually high-flying tech stock struggles with the burden of raised expectations.

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The world's most valuable public company saw its stock price drop for a fifth straight day on Tuesday, falling as much as $5.19 or 4.4 percent, to $113.25 as investors fretted over China's economy and whether Apple can keep growing at the pace it's maintained over the last few quarters.

Apple shares are down 14 percent since closing at a record $133 in February. That puts Apple in a "correction," which is Wall Street jargon for price declines of 10 percent or more from a peak.

The stock also dropped below its 200-day moving average, a technical indicator that traders use to gauge momentum.

Apple sold more than 47 million of its signature iPhones in the last quarter, or 35 percent more than a year earlier. That drove the company's profit and earnings above Wall Street estimates. But iPhone sales were not quite as good as some analysts predicted, and executives gave a lukewarm forecast for the current period. That has sent the stock into a decline since Apple reported earnings on July 21.

Shareholders are also worried about recent hiccups in China's economy, because the country is viewed as one of Apple's biggest markets for expansion, said Daniel Ives, a managing director and senior analyst for FBR Capital Markets.

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He added that investors are looking ahead to the December quarter, which is traditionally Apple's strongest. The company sold 74 million iPhones during that period last year, a 46 percent jump. But it will be more difficult for Apple to show that kind of growth again.

Apple is now a "prove me" stock for some investors, said Ives, although he added that new products like Apple Pay and the expected release of new iPhone models this fall could give the company a boost.