Apple is the victim of bad timing, not a crackdown, as China flexes its internet sovereignty.
by Global Risk Insights
Financial Sense
Last week China shut down iTunes Movies and iBooks, shocking many investors. While Apple has in the past managed to avoid the Beijing’s caprice, this latest development shows that Apple is not immune to the hazards of doing business in China.
While CEO Tim Cook has pledged to increase investment in China, recent events, along with slowing growth in China, come at a bad time for Apple. The company is already facing slower iPhone sales, for example. To add to Apple’s woes, the service shutdown came just a few days before the company released its Q2 earnings. Last week, Apple stock was heading towards $108, until news from China saw it hit a low of $104.72, before closing the week at $105.68. This was a largest share price drop since January.