A few days ago, U.S. equity markets plunged, and the three major stock indexes closed down by as much as 1.9%. Shares of Apple Inc. (NASDAQ: AAPL) dodged the decline, and the shares actually added 3% for the day. One theory was that Apple had become a safe haven, much like gold or U.S. Treasury notes.
The Financial Times, however, attributed Tuesday’s unusual trading session to an “explosion” of options trading in Apple stock. According to the report, the stock’s move displayed “a few of the hallmarks of the ‘meme stock craze’ … when ferocious trading in options markets combined with fevered discussions on retail investor message boards propelled stocks a fraction of Apple’s size.” Greg Boutle, a strategist at BNP Paribus, commented, “Flow begets flow and . . . the evidence is there that there’’ been an explosion of retail account openings and then an explosion of option volumes.”
The Financial Times also noted that investors have been buying “extraordinary” volumes of Apple call options that pay off if the share price rises: “On Wednesday and Thursday, more than 5 [million] call contracts in total were purchased, with both days ranking among the 15 busiest Apple options trading days in history.”
It wasn’t all retail traders. Institutional investors had to be involved as well to account for the massive volume. Amy Wu Silverman, an equity derivatives strategist at the Royal Bank of Canada, told the Financial Times:
Institutions are literally waiting for the scent of retail, because they know it increases the momentum. The retail footprint becomes the institutional footprint very quickly. It almost snowballs what was a pure retail move.
Apple, on Tuesday, filed a motion to delay an injunction requiring the company to change its App Store in-app purchase requirements as a result of the decision in the Epic Games lawsuit. By the end of next week, Apple must allow app developers to include buttons and external links that customers could use to make purchases.
In a filing with the Ninth Circuit Court of Appeals, Apple’s attorneys argued that there is “undisputed evidence” that making the changes order by federal district judge Yvonne Gonzalez Rogers “will harm, users, developers, and the iOS platform more generally.”
Among the arguments for a delay is that “substantial engineering will be required will be required to accommodate the impact of the injunction on the ‘layers of protection’ that [in-app purchasing] offers, including parental controls as well as purchase authorization, completion, and restoration.” The motion continues: “Apple would have to create a system and process for doing so; but because Apple could not recoup those expenditures (of time and resources) from Epic even after prevailing on appeal, the injunction would impose irreparable injury.”
Chipmaker Intel is reportedly trying to carve out a place for itself in the queue to take advantage of rival Taiwan Semiconductor’s 3-nanometer production technology in an effort to pull itself equal with, if not ahead of, Apple which uses TSMC’s 5-nanometer process to produce chips for iPhone, iPad, and Mac.
Apple and Facebook/Meta have signed big real Silicon Valley estate leases in the past few months, perhaps squelching fears of a tech exodus from the storied region.
The Verge has an in-depth report of how Apple’s hourly employees are “struggling to survive.”