Most valuable U.S. Company Apple Inc. (NASDAQ:AAPL) lost $26.1 billion of market value on Wednesday owing to a number of factors. The iPhone maker lost $4.36, or 4.2%, to $98.94 on Wednesday. This is the biggest dollar decline for Apple since losing $6.19, or 8%, to $71.17 on a split-adjusted basis on Jan. 28, 2014.
A big loss for Apple
A fact that would come as a surprise is the market value lost by Apple Inc. (NASDAQ:AAPL) is more than half of the companies in the Standard & Poor’s 500. For example, Marriott International has a market cap of $20.2 billion.
Apple stock carries so much weight age at the Standard & Poor’s 500 that it pushed the benchmark into the red down. If Apple value has remained the same then S&P 500 would have gained 1.41 points to set a new record high.
Apple Inc. (NASDAQ:AAPL) is expected to unveil the large screen iPhone at a Sept. 9 event. Investors have long been worried over the new technologies pushed by the rivals. Even some of the features expected in the iPhone 6 are already offered by Samsung’s Galaxy and Microsoft’s (MSFT) Lumia lines.
“Stocks can trade with increased volatility around events and there is a big event expected for next Tuesday,” says Walter Piecyk, analyst at BTIG.
What caused the decline?
Many factors contributed to the decline of Apple shares including the moves from rivals. Facebook Inc’s virtual reality unit, Oculus announced plans to integrate its technology in the Samsung devices. Also, Samsung announced Galaxy Note Edge, which appears an impressive device with an innovative side screen. The device may give a tough competition to the upcoming iPhone.
“We think Apple has little room for error in delivering on a spectacular iPhone 6 launch,” says Brian Colello, analyst at Morningstar.
Also, over the weekend, news surfaced about hackers accessing private photos of the celebrities’ stored on the Apple Inc. (NASDAQ:AAPL) online service called, iCloud. The whole event raises questions the security concerns among the users even though Apple clarified that there was no fault at its end.
“Concerns over the iCloud have hit at the worst possible time for Apple – a highly publicized flow that’s making the news a week before a major launch,” Colello says.
The decline on Wednesday broke the powerful rally in 2014 riding on the expectations of a large screen iPhone and a watch-like gadget. Until Tuesday, Apple shares are up 23% this year.