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Apple reclaims safe-haven status amid waning AI trade confidence

MacDailyNews

Nov 6

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Amid a broad selloff that grounded soaring AI stocks from Nvidia to Palantir Technologies, Apple emerged unscathed. Cupertino posted a modest gain as the Nasdaq 100 dropped 1.6%, echoing Tuesday’s session when Apple edged higher while the index plunged 2.1%. Over the past month, Apple has climbed more than 5%, far outpacing the tech-heavy index’s gain of less than 0.5%.

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The outperformance is a return to form for Apple, whose cash-generating prowess and rock-solid balance sheet have in past bouts of turbulence left it relatively unscathed. The stock has lagged behind the broader market for most of this year as investors chased artificial intelligence riches.
“We’re seeing enthusiasm roll over in the more speculative names, which have become frothy and a victim of their own success. And in a risk-off environment, Apple’s cash flow, stability and predictability are all attributes investors are shifting toward,” said Jack Ablin, chief investment strategist at Cresset Wealth Advisors…
Apple is planning to pay about $1 billion a year for an artificial intelligence model developed by Alphabet Inc. to help power an overhaul of its Siri voice assistant.
“This is a positive, since it helps Apple participate in AI and $1 billion is a whole lot less than the other companies are spending,” Ablin said.
Alphabet Inc., Meta Platforms Inc., Amazon.com Inc., and Microsoft Corp. together spent more than $110 billion on capex last quarter, and the four companies are expected to boost combined capital spending 34% to roughly $440 billion over the next 12 months, according to data compiled by Bloomberg.

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MacDailyNews Take: Apple investors holding for the long term will be rewarded.

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