Sterne Agee notes AAPL getting hit because of the headlines from Consumer
SMF has already been short the name and have already worked out the numbers that can take it much lower moving forward
Sterne Agee notes AAPL getting hit because of the headlines from Consumer
Reports that the iPhone4 signal issues are hardware related. Also market
concerns that AAPL might now have to do a product recall on the iPhone4. Firm
believes total one time replacement costs for AAPL: <$100 mln on a
quarterly revenue run rate of $13-15 bln.
Key for AAPL is it needs to get fixed, ahead of the peak BTS and holiday season. It could create a near-term hiccup in the supply chain if it is really a hardware issue and needs redesign: for component suppliers SNDK, CEVA, SWKS and CRUS. But any major pullback should be viewed as a buying opportunity.
WSJ reports the SEC is expected to ban flash orders on stock exchanges. But the fate of giving market participants a sneak peek at options trades is fuzzy.
The options market is much more dependent on flash trading than stock markets, which have received most of the scrutiny from lawmakers and regulators worried that some traders are getting an unfair advantage over other investors.
The SEC proposed a rule amendment in September that would eliminate flash orders, and the agency's staff is likely to make recommendations to the full commission early next year, an agency spokesman said. While flash orders are a relatively new and small part of stock markets, they are a major cog in options trading known as "step-up" orders.
An outright ban could trigger upheaval in the options markets, according to market participants. Some are urging the SEC to continue allowing step-up orders, claiming they save investors money.
In addition to potentially redirecting the flow of hundreds of millions of dollars in Wall Street profits, the outcome could shift power in the options markets, which give investors the right to buy or sell a stock at a given price within a set time frame. (Stocks mentioned: AMTD, NYX)