Apple is coming off a terrible year and Wall Street is torn on whether it's set for more pain or about to skyrocket.
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Phil Rosen
Jan 5, 2023, 17:57 IST
Apple CEO Tim CookJerod Harris/Getty Images Entertainment
Happy Friday eve, team. Phil Rosen here, reporting from Los Angeles.
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Something to note right off the bat: The Fed released minutes from its December meeting yesterday, and policymakers seem concerned that bullishness from investors could make fighting inflation harder.
Basically, if markets rally in part because of expectations for cooling inflation, the opposite could become true.
Asset prices could rocket higher again if investors believe the central bank is about to pull back. This has been shown in the speedy decline of US Treasury yields, which in part reflects investors' outlook on further rate hikes.
While the meeting minutes don't tell us exactly what the Fed will do next month, generally they are worth paying attention to for hints into the thinking of central bankers.
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For now though, let's turn to the mightiest tech stock in the world.
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1. Apple is coming off a rotten year, shedding $846.34 billion in value in 2022.
Shares fell further on Tuesday and Wednesday after a Nikkei report said demand for MacBooks, AirPods, and Apple Watches is weakening.
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The tumble brought the tech giant's market cap below $2 trillion. It was the last company standing above that threshold.
He said December weakness isn't something that will last because customers are loyal to the brand.
"Ultimately consumers may delay for three, six, nine months, but they're going to come back, they're going to be upgrading iPhones, Macs, iPads [and] I think that's something investors can lean into," Munster said.
It maintained its outperform rating, but analysts said supply chain checks in Asia remain suspect heading into the coming quarters, reflecting a softening consumer environment.
Still, Wedbush's Dan Ives noted that demand for the core iPhone 14 Pro looks to be more stable than feared, which will make the overall landscape more resilient than Wall Street expects.
"[W]e believe baked into the stock is a massive amount of bad news ahead," Ives wrote, adding that Apple is still a tech-favorite.
Still, there are more than 200 million iPhone units that haven't been upgraded in four years, and that's a key part of Apple's underlying demand story.
Ives pointed out, too, that the next iPhone model is expected to come out alongside an augmented reality headset, dubbed "Apple Glasses," which should help the company remain a "Rock of Gibraltar name into 2023."
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What's your outlook for Apple stock this year? Tweet me (@philrosenn) or email me (prosen@insider.com) to let me know.
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