12th September 2012  Investors Show Mixed Feelings For Apple iPhone 5.

While the internet and tech blogs have been broadly positive of the newly announced iPhone 5, Apple Inc.'s (AAPL) share price underwent a rollercoaster ride before investors gave their stamp of approval towards the close of trading.


Trading opened on the NASDAQ with shares spiking to over $664 but they had returned to near their previous close of $661.18 as CEO Tim Cook took to the stage at the Yerba Buena Theatre in San Francisco. A number of leaks meant that the entire specs of the new iPhone 5 were as good as known well in advance and each new announcement just confirmed what the rumour mills had been predicting.


After Tim Cook's introduction bought the price up it turned negative as Senior VP of Worldwide Marketing Phil Schiller announced the name and displayed the device for the first time. Shares had fallen as far as $657, a new daily low, as Schiller described its lighter weight and increased screen size.


In less than 25 minutes the share price jumped 1.68% to a daily high of over $668 after Schiller announced LTE support and its A6 processor before Electronic Arts Inc.'s (EA) Executive Producer Rob Murray showed "Real Racing 3" returned to discuss battery, life its camera and dock connector.


While the price pulled back it remained stable until the hour mark. It might be a bit of a stretch to blame the rather lengthy video by Jony Ive talking about the phones design but shares fell 0.5% during its showing before Schiller returned to announce the prices.


Shares lifted again toward the $665 mark as Senior VP of Internet Software and Services Eddy Cue discussed changes to iTunes and iPod. The pricing list for the iPod nano (which has been completely renanoed) and iPod touch acted as a cue for another slump. The share price began a 1.2% decrease over the next half an hour with neither Tim Cook's ads for iPod nor the stains of Foo Fighters capable of stopping it dropping back to $657.


The specs didn't really surprise or amaze anyone. What we are effectively looking at is a lighter iPhone 4S with a bigger screen and some cosmetic changes to the other stuff Apple makes. In the iPhone 4S and 5 Apple now has a successful product that can't be majorly improved upon. Investors have often dumped shares towards the end or in the aftermath of Apple events that have failed to wow; this time was no different. And, as in those other times, others were sitting on the fence waiting for a chance to snap those shares up cheaply.


Hovering at $657 as the Yerba Buena emptied out the share price rose 1.8% to close at a new 2-day high of$ 669.79 and reaching over $671 in after-hours trading. No matter what the product, Apple's numbers are hard to argue with. 380 stores in 12 countries, 7 million copies of Mountain Lion downloaded since July, and No. 1 in US market share for notebooks. They have sold 84 million iPads since June giving them 68% of the worldwide table market, up from 62% last year. In total they have 400 million iOS devices sold through to June of this year. iTunes now has 435 million accounts with 1-Click shopping; that's a lot of customers and a lot of credit card details.


Overall investors were mixed on the new iPhone. Some saw fit to sell, unimpressed by the new model while others saw a price of $657 as a buy opportunity, envisaging room for growth. Still triumphant from its patent victory Apple has strengthened its short term position with today's announcement. Its share price sits near an all-time high, registering it as one of the most valuable companies of all-time. The iPhone 5 will sell and sell well and while questions will have to be asked about its long term strategy, especially as it is now releasing a new iPhone iteration less than a year after the last one, Apple is hotting up the battle for market share and dominating the mobile phone market.



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