apple

Apple stock (NYSE: AAPL) soared 8.9% yesterday amid a broad-based market rally. Apple’s market cap rose by $190.9 billion in a single day, which is a new single-day record.

Sticky inflation has been a worry for markets. US CPI was above 8% since March and briefly went above 9% also. However, in October, CPI increased at an annualized pace of 7.7%. The reading was better than the 7.9% that economists were expecting and marks the first time since February when annualized inflation has fallen below 8%.

While the inflation is way above the 2% that the Fed targets, the softer-than-expected October CPI is nonetheless a positive for markets.

Coming back to Apple stock, it made a record yesterday as the world’s largest company added almost $191 billion to its market cap in a single day. Amazon previously held the record and its market cap went up by $190.8 billion in February.

That said, Amazon holds the dubious record of losing over $1 trillion in its market cap. No other company in history has lost $1 trillion in market cap.

Apple is Facing Supply Chain Issues due to China lockdowns

Apple is facing supply chain issues due to the lockdowns in China. Foxconn’s assembly plant in Zhengzhou, which is the largest factory for the company, is battling a COVID-19 outbreak which has impacted its production.

AAPL warned of supply chain hiccups earlier this week. It said, “COVID-19 restrictions have temporarily impacted the primary iPhone 14 Pro and iPhone 14 Pro Max assembly facility located in Zhengzhou, China. The facility is currently operating at significantly reduced capacity.”

The supply chain issues have come just ahead of the holiday shopping season in the US. Meanwhile, in what looks like another positive news for Apple, China has relaxed some of the COVID-19 restrictions.

Foxconn is Increasing its Footprint in India

For the long term, Apple is trying to diversify its sourcing away from China. Reuters reported that Foxconn which is the largest Apple supplier is looking to increase its workforce in India four-fold.

India is offering incentives to electronics manufacturers as the country seeks to capitalize on the “China plus one” sourcing strategy that many US companies are contemplating. Indian stocks are also outperforming global markets this year amid a strong domestic economy. We have a guide on how beginners can buy stocks in India with a regulated broker.

Meanwhile, Apple wouldn’t find it easy to diversify from China given the country’s impeccable manufacturing ecosystem, which is tough for other countries to emulate. Counterpoint Research believes that Apple would take years to diversify its production away from China.

Apple is Investing $450 Million in Satellite Connectivity

The iPhone 14 model features satellite connectivity which would allow users to communicate even if they are outside cellular and WiFi connectivity.

Apple is investing $450 million in satellite connectivity. Apple said that most of this funding would go to Globalstar. While Globalstar is a penny stock, it has been in the limelight, thanks to the company’s partnership with Apple.

Apple has increased its installed user base significantly. The company said that it had 900 million paid subscribers across platforms at the end of the fiscal fourth quarter and it added 155 million subscribers in the last year alone. It posted better-than-expected earnings for the September quarter even as most other tech companies posted disappointing earnings.

AAPL stock is outperforming FAANG peers this year by a wide margin. Even Warren Buffett added more Apple shares in the first half of 2022. Next week, we’ll get to know whether the “Oracle of Omaha” added more Apple shares in the third quarter, as Berkshire Hathaway releases its Q3 2022 13F.

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