Icahn unloads all of his Apple stock
Billionaire business magnate Carl Icahn, whose investment decisions can influence the stock market, said Thursday that he dumped what was left of his nearly 1 percent stake in Apple amid fears that Chinese authorities would bully the iPhone maker.
Shares of Apple sunk after his announcement in a live interview on CNBC. The shares have lost 9 percent of their value since Apple revealed Tuesday troubling first-quarter financial results, including a 26 percent sales drop in Greater China compared with the same period last year.
“China obviously could be a shadow for it, and we have to look at that,” Icahn said of Apple.
U.S. stocks took their biggest loss in three weeks Thursday after a late selloff. Tech stocks, which rose early thanks to earnings gains from Facebook and PayPal, slumped after Icahn disclosed that he’d sold his stake in Apple. Icahn wasn’t a major shareholder, but his moves are closely watched by many investors.
Chinese consumers once infatuated with the iPhone as a status symbol of new wealth have increasingly turned to more affordable alternatives. And regulators in China recently moved aggressively against Apple, blocking access to its online stores for digital books and movies. It’s unclear when access might be restored.
Financial analysts say it’s too early to worry about the falling sales in Apple’s largest market after U.S. Apple executives said Tuesday that they remained committed to China and that its economy is steadier than many believe. The company also manufacturers in China.
But the capricious nature of China’s government was too much for Icahn, especially after an unexpected fall in oil prices ravaged his energy bets last year.
“I worry a little bit that a tsunami could hit it,” he told CNBC.
Icahn called Apple Chief Executive Tim Cook on Thursday morning to disclose the sell-off. Cook was sorry to hear it, he said.
But Icahn noted he still believes that Apple shares are undervalued and that he would hop back in if conditions in China were more settled.