(Repost) Bloomberg -- Apple’s Reign as World’s Top Stock at Risk From Bumpy 2024 Start

(Transcribed with OpenAI Whisper)

Apple's reign as world's top stock at risk from bumpy 2024 start. Apple Inc. just had its worst start to the year by one measure as investors react to mounting pressures on the company, putting its longstanding status as the world's most valuable stock by market value in jeopardy. Shares of the technology giant fell 0.4% Friday to close at about $181 after the New York Times reported that the Justice Department is closer to filing an antitrust case against the company. The decline notched the fifth consecutive negative day for Apple, its longest losing streak since October. The potential antitrust case against Apple would add to the plethora of problems it faces, from slowing iPhone sales to watch patent issues, Bloomberg intelligence analyst Anurag Rana wrote in a note. The suit could attack Apple's business model of tightly integrating its devices and services. The Cupertino, California-based company has been the most valuable publicly listed company since July 2022, but has seen about $177 billion in market value erased so far this year, according to data compiled by Bloomberg. While the stock has suffered bigger percentage declines in the first week of January, the losses are the biggest market value destruction at the start of any year on record. The downturn began earlier in the week after the technology giant was hit by two ratings analysts flagging a weak macro environment in China pressuring demand for iPhones. That has shrunk its lead over fellow technology juggernaut Microsoft Corporation, whose shares have seen a less pronounced decline to begin the year, to less than $100 billion. Investors realize how rare it is to have two people go negative, said Gene Munster, managing partner of Deepwater Asset Management. I've been covering this company for a long time and I've never seen two downgrades before an earnings report. Apple is also likely under pressure as investors rotate their portfolios at the start of the year. Everybody's selling their winners and buying losers, said Brian Mulberry, client portfolio manager at Zacks Investment Management. There's a big rebalance going on. The losses have pushed Apple's market value down to about $2.8 trillion, nearing Microsoft's $2.7 trillion. Shares of Microsoft fell less than 0.1% Friday to close at about $368. The Windows software maker has benefited from the artificial intelligence trade that has mesmerized Wall Street over the past year. The company is OpenAI's largest shareholder and has invested about $13 billion into the chat GPT parent.

1. Apple's Challenging Start to 2024: Apple Inc. experienced its worst start to a year by market value, as investors responded to various pressures facing the company. This has put its status as the world's most valuable stock by market value at risk.

2. Impact of Potential Antitrust Case: The Justice Department is reportedly closer to filing an antitrust case against Apple, which contributed to a 0.4% drop in its shares. This potential lawsuit could challenge Apple's business model of integrating its devices and services.

3. Longest Losing Streak Since October: The decline in Apple's stock price marks its fifth consecutive negative day, the longest losing streak since October.

4. Multiple Challenges for Apple: The company faces several issues, including slowing iPhone sales, watch patent problems, and the potential antitrust case. Bloomberg intelligence analyst Anurag Rana highlighted these challenges in a recent note.

5. Significant Market Value Loss: Apple has lost about $177 billion in market value so far this year, the most significant loss at the start of any year on record.

6. Analyst Downgrades and China's Macro Environment: The downturn began after analyst downgrades, citing a weak macro environment in China affecting iPhone demand. This is reportedly the first time two downgrades have occurred before an earnings report for Apple.

7. Portfolio Rotation by Investors: Investors are rebalancing their portfolios, selling winners and buying losers, contributing to the pressure on Apple's stock.

8. Market Value Comparison with Microsoft: Apple's market value has decreased to around $2.8 trillion, closely approaching Microsoft's $2.7 trillion. Microsoft's stock has experienced a less significant decline at the start of the year.

9. Microsoft's Advantage in AI: Microsoft, as the largest shareholder of OpenAI and an investor in its parent company, has benefited from the focus on artificial intelligence in Wall Street. The company has invested about $13 billion in chat GPT's parent.

Overall, the article highlights the various challenges and market dynamics impacting Apple's stock performance at the start of 2024, contrasting it with the relatively more stable position of Microsoft.