People queue outside an Apple store to buy the new iPhone 6 and 6 Plus in Beijing November 16, 2014.
Reuters/Petar Kujundzic
SAN FRANCISCO Apple Inc’s (AAPL.O) stock was heading toward its first five-session losing streak since January on Thursday as investors worried about the economic health of China, a key market for iPhones.
Apple shares were down 2 percent at $120.15 in afternoon trade and have lost about 4 percent since July 1.
In the first three months of the year, for the first time, Apple sold more iPhones in China than in the United States, a trend expected to grow as Chinese consumers upgrade from less expensive handsets.
But with around 30 percent knocked off the value of Chinese shares since mid June, some investors fear that the turmoil could hurt consumer demand and the Chinese economy as a whole. [ID:nL3N0ZO5WX]
Individuals account for a major chunk of stock investing in China and the market selloff may curb their disposable incomes.
“China is poised to be Apple’s high-octane fuel for the next few years, especially for iPhones,” said FBR analyst Daniel Ives. “Given a lot of the dark clouds we are seeing in China, that has spooked investors.”
Also rattling investors was a report this week by research firm Slice Intelligence that sales of the Apple Watch have dropped since its launch in April. Apple has not disclosed sales of the devices.
The Apple Watch is not seen as significant for profits in the short term but the wrist-worn gadget is Chief Executive Tim Cook’s first major product and its failure would be poorly received by Wall Street.
Apple’s stock was also within 1 percentage point of falling below its 200-day moving average, an indicator watched closely by traders, for the first time since April 2014.
(Reporting by Noel Randewich; Editing by Peter Galloway)
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