The financial disaster triggered by the launch of the new iPhone

By | September 26, 2017

 

The most recent devices launched by Apple were greeted by users with a dose of skepticism, especially by those investors who invested in the Asian supplying industry, writes Bloomberg.

Hon Hai Precision Industry, which assembles iPhone and other Apple products, decreased with 10% on the Taipei stock market since Apple launched its new collection of gadgets.

Other suppliers in the region, including Pegaron in Taiwan and Innotek in South Korea, reported a 12% collapse.

The $1.100 billion market in Taiwan is extremely exposed to changes in Apple’s prospects due to the dominance of component manufacturers.

Hon Hai and Taiwan Semiconductor Manufacturing, the company providing the main chips for Apple, account for a quarter of the total Taiex index, while exports account for more than half of Taiwan’s GDP.

“The demand for the new iPhone has been disappointing for markets and for foreign investors, and strong supplier shrinking could continue on the Taiwan stock market”, said Alan Tseng, vice president of Capital Investment Management in Taiwan.

“Apple’s stock market fells down the benchmark market index in Taiwan and could affect it further in the upcoming period.”

Foreign investors withdrew last week a total of 677 million dollars from Taiwan’s capital market, the largest exodus in the past three months. Prior to Apple’s launch, the optimism that the new iPhone model could propel Taiwanese shares has sent the Taiex index at its peak.

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