Apple’s China Sales Woes Rattle Investors, Fuel Market Decline

AFP/APP
Hong Kong: On Wednesday, most Asian shares dipped following a global market decline, driven by profit-taking after recent surges led by the technology sector.
Gold and bitcoin reached record highs on Tuesday but later retreated, while the sell-off in certain tech stocks affected markets worldwide.
Wall Street’s major indexes fell, particularly the Nasdaq, which dropped 1.7 percent due to declines in Apple and Tesla shares.
Apple’s stock took a hit after reports revealed lower iPhone sales in China at the start of the year, highlighting ongoing trade tensions between the US and China, according to Stephen Innes of SPI Asset Management.
The reliance on a few major tech companies for market gains makes indices vulnerable to negative news about these companies, especially if concerns arise from their performance in China, a significant market for them.
Concerns intensified as China announced a modest growth target of five percent for 2024 during its annual legislative session, disappointing traders who had hoped for more aggressive stimulus measures.
Premier Li’s speech signaled China’s commitment to avoiding large-scale stimulus, which contributed to global market uncertainty.
Economists Duncan Wrigley and Kelvin Lam of Pantheon Macroeconomics noted calls for deeper interventions to address China’s economic challenges, including a property sector crisis, high youth unemployment, and weak global demand for exports.
They predicted that Beijing would rely on fiscal support to maintain growth while gradually transitioning away from real estate dependency.
Investors are closely watching Federal Reserve Chair Jerome Powell’s congressional testimony for insights into the timing of potential rate cuts.
While the Fed is expected to cut rates later this year, officials remain cautious pending further inflation data. Additionally, US jobs figures due later in the week will provide further insight into the state of the economy.
Several Asian markets, including Tokyo, Shanghai, Sydney, Seoul, Manila, Wellington, and Kuala Lumpur, experienced declines on Wednesday, while others like Hong Kong, Taipei, Singapore, and Jakarta saw gains.