Apple shares took an inexplicable beating from investors on Monday morning, leading to the stock’s single biggest fall since January 28th, 2014. And no one really know why.
An unusual spike in trading volume this morning sent the price of AAPL shares falling as much as 6.4 percent to $111.27 in early trading this morning, leading to a loss of more than $40 billion in market value in just a few minutes.
The cause for the sudden fall in price is still being debated among the Wall Street crowd, but Reuters reports that an acceleration in the sales of AAPL shares could have sent the stock tumbling. At 9:51AM EST, more than 6.7 million shares were traded in a one-minute stretch – the heaviest single minute of AAPL trading since October 29th.
Traders have pointed to institutions that use automated selling programs as the possible culprit, but High Frequency Trading advocates like Bill Harts at Modern Markets Initiative have said that blaming the drop on HTF is ‘misleading.’ Technology stocks overall have been down today. Twitter fell 5%, LinkedIn dropped 4%, and Facebook slipped 2%. Google is also down as much as one percent.
More than 64 million shares of APPL have been traded as of 2PM EST, making it the most active stock in the U.S. market. Other factors may have contributed to the fall, such as poor Black Friday shopping numbers, plummeting oil prices, or profit taking by investors.
Got your own theory on why Apple shares are suddenly falling? Drop your thoughts in the comments below.
Buster Hein is a freelance writer who lives in Phoenix, Arizona. Twitter: @bst3r.
8 responses to “‘Unusual’ trading spurs sharp drop in Apple shares”
No mystery. Today Carl Ichan dumped his shares after pumping for the last year. ?
lol?
If you’re serious, you’re awfully unaware of how AAPL historically acts. It is often whipsawed by options and shorts.
Likely a massive blind short was placed by a bear which in turn sent prices tumbling below many traders stops, thus reinforcing the short position.
The only question is whether it continues or reverses over the next few trading sessions.
Action like this makes me very happy that AAPL has an enormous, opportunistic stock buyback going on. They just get to continue to accumulate at a 3% discount.
It was 5.95 points in less than 1 min—it was algorithmic trading.
This.
Could have been worst, my portfolio is still looking good… fingers crossed.
Greed for these swine is always the motivation… Never lose sight of that and you’ll never be surprised….
Traders, especially HFT traders, don’t care which way AAPL moves as long as it moves. They make zero money on a static stock price. Their worst case scenario is every pension and retirement fund manager’s dream; slow, steady, predictable, one-way appreciation reflecting the underlying value.
Algorithmic (HFT) traders pile in when movement exceeds certain thresholds. In this case it is very obvious to spot – it breached the 100 SMA on a 30 minute basis. This has been a support line for weeks now.