After clawing back early losses on Wednesday to post a higher close,martell heroes 2 the major U.S. stock indexes are trading lower early Thursday. The catalyst behind the weakness is a letter to investors from CEO Tim Cook that announced lower Q1 guidance. Prior to the announcement, Apple stock was halted in after-hours trading. When trading resumed 20 minutes later, shares were down about 7 percent.

All three major indexes were affected by the news because Apple is a component in each. At 0232 GMT,

March E-mini S&P 500 Index

futures are trading 2483.25, down 27.75 or -1.11%.

March E-mini Dow Jones Industrial Average

futures are at 23066, down 259 or -1.11% and

March E-mini NASDAQ-100 Index

futures are trading 6247.50, down 123.50 or -1.94%.

According to the letter, Apple lowered revenue guidance to $84 billion, down from $89 to $93 billion it had previously projected. The company also lowered gross margin to about 38 percent from between 38 percent and 38.5 percent.

Who’s to Blame?

In the letter, Apple blamed a variety of factors for the lowered guidance, including a weakening economy in China and lower-than-expected iPhone revenue. Apple said the lower-than-anticipated revenue happened “primarily in Greater China,” but also said that upgrades to new iPhone models in other countries were “not as strong as we thought they would be.”

Apple CEO Tim Cook Blames China for Weak iPhone Sales

In his letter, cook said fewer carrier subsidies, price increases based on the strength of the U.S. Dollar and cheaper battery replacements caused the weak iPhone upgrades for the quarter.

“If you look at our results, our shortfalls is over 100 percent from iPhone and its primary in greater China,” Cook told CNBC’s Josh Lipton in an interview Wednesday.

“It’s clear that the economy began to slow there for the second half and what I believe to be the case is the trade tensions between the United States and China put additional pressure on their economy.”

Tech Stocks Under Pressure

The weakness in Apple is spreading across the U.S. technology sector. Chip stocks Advanced Micro Devices, NVidia, Skyworks and Qorvo all dropped in after-hours trading on the Apple warning.

Additionally, the Invesco QQQ Trust, which tracks the tech heavy NASDAQ-100 Index, lost more than 2 percent in after-hours trading on Wednesday. The S&P ETF Trust, tracking the broader market, lost more than 1 percent in extended trading.

Worst May Be Over as Asian Stocks Rebound

Stocks in Asia were mostly higher on Thursday morning despite the weaker U.S. futures markets. South Korea’s Kospi recovered from its earlier losses to trade higher by more than 1 percent despite shares of Apple suppliers Samsung Electronics and SK Hynix dropping 1.55 percent and 2.64 percent, respectively.

Story continues

Stocks are trading lower in Japan, but higher in China. The Australian S&P/ASX 200 Index was bolstered by strong demand for energy stocks after the rally in crude oil.

This

article

was originally posted on FX Empire

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