Apple leads tech rout after Berkshire Hathaway sells more than half of its stake
Apple; Getty Images; Chelsea Jia Feng/BI
- Apple stock plunged as much as 11% on Monday on news that Berkshire Hathaway sold about 50% of its stake.
- Warren Buffett's conglomerate sold about 390 million Apple shares in the second quarter.
- Berkshire's cash pile hit a record $277 billion, raising concerns about Buffett's market outlook.
Apple stock plunged as much as 11% on Monday, leading the tech rout lower amid a global stock market panic.
The decline in Apple shares, which was double the Nasdaq 100's decline of about 5%, came after it was revealed over the weekend that Warren Buffett's Berkshire Hathaway sold about 50% of its Apple stake.
The stock pared the deepest losses shortly after the opening bell, with shares trading about 4.8% lower at $209.73 at 10:14 a.m. ET.
According to its second-quarter earnings report, Berkshire Hathaway sold about 390 million Apple shares during the quarter, which is on top of the 115 million Apple shares it sold during the first quarter of the year.
Berkshire Hathaway first purchased Apple stock in 2016. The conglomerate still owned about 400 million shares of the iPhone maker worth about $84 billion as of June 30, still making it the largest investment holding for the company.
The sales catapulted Berkshire Hathaway's cash position to a record $277 billion, which is up 47% from the first-quarter. The massive cash position has some investors concerned that Buffett has turned sour on stocks.
"If you look at the entire Berkshire picture and the macroeconomic data, a safe conclusion is that Berkshire is getting defensive," said Cathy Seifert, CFRA Research analyst Cathy Seifert said.
Wedbush analyst Dan Ives called the Apple sale "eye-popping" and said "it's going to add to pressure here" in an interview with CNBC on Monday.
Yet, Ives remained constructive on the company ahead of its upcoming iPhone 16 launch.
"It's still his number one holding. He is a huge supporter of Cupertino, number one holding almost double of BofA. This is not the time to sell Apple despite some of the nervousness here. This is an opportunity, especially going into what I view as a really historic upgrade cycle for Apple," Ives said.