Just what Apple has fallen since it reached its all-time high on July 31 is enough to buy almost half of the Ibex-35. That means about 287 billion dollars (268 billion euros), which would be enough to buy (without premiums, of course), with 100% of Inditex, Iberdrola, Banco Santander and BBVA. And there would still be more than 15,000 million change left.
The decline has accelerated so far this week. In just two days, the company led by Tim Cook had given up 200,000 million dollars (186,000 million euros). Despite the decline, the share price still accumulates a revaluation of more than 35% so far this year, and Apple remains the most valuable company in the world.
The latest collapse of the iPhone giant – the product that generates about half of Apple’s sales – is due to something the company has no control over: geopolitical tensions between the United States and China. On Wednesday, the Wall Street Journal reported that the Chinese government has banned public officials working for the central administration from using foreign-brand phones, citing national security reasons.
For Apple, that would be a blow, albeit a manageable one. According to the financial magazine Barron’s, Daniel Ives, from the Californian fund manager Wedbush, has estimated that the measure could reduce iPhone sales by half a million in the next twelve months, which only represents 1.1% of iPhones sold. in the Chinese market in that period. China accounts for 19% of Apple’s total sales in the world, making it the company’s second most important market after the United States.
The problem for the company founded by Steve Jobs could, however, be much more serious if the Chinese government decides to extend the ban on the use of foreign mobile phones to the country’s state-owned companies, which could reduce iPhone sales by millions of dollars. units. The measure would already have precedents: two years ago, China banned the use of cars from the American company Tesla among this group. All in all, the electric car manufacturer has managed to overcome the Chinese barriers to turn that country, also, into its second largest market.
China’s measures are placed in the context of the ‘Cold War’ between Washington and Beijing. The ban on the use of foreign phones by officials of the Chinese central administration – although not by the provinces – is inevitably reminiscent of the restrictions imposed in the United States and many of its allies on the use of telecommunications systems from the companies ZTE and Huawei, and the social network TikTok, all of them controlled by Chinese entities.
They could also have a component of coercion against Apple, a company that generates five million direct and indirect jobs in China, and that is rapidly reducing its dependence on that country’s supply chain. At a time when China appears to be descending into a structural degrowth crisis, Beijing could be threatening Apple with more drastic measures if it continues to leave. That is precisely one of the arguments of investors who continue to trust Apple.
The slowdown of the Chinese economy and the growing opacity of that country’s politics have also led large investment funds to reduce their exposure to companies with a strong presence in the Asian giant, among which, according to some interpretations, could be Also Apple. Finally, the company presented disappointing results in the second quarter of the year, especially due to the drop in demand for its devices.