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How Apple Controls Stock Market, World


As Apple's empire grows, its role in the broader market gets riskier.


In Cupertino, everything is coming up roses.

Apple (AAPL) has already surpassed Microsoft (MSFT) as the nation's biggest tech company (in terms of market capitalization), and is on track to take over Exxon Mobil (XOM) as the nation's largest company, according to IBD. The iPad is on track to be the fastest selling device in history. And with rumors persisting that the iPhone is on its way to Verizon (VZ), consumers have every reason to stay excited.

But the bigger Apple gets the riskier role it plays in the broader market. A new theory even suggests that a single misstep by Apple could have a significant negative impact on the broader market. Last week, shares of the company had a mini-crash. The same day, the Nasdaq tanked at the open.

Vincent Fernando connects the dots:

1. AAPL shares had a mini-crash this morning [September 28], losing $15 right at the open, on more volume that AAPL normally does in an entire day. It appears like this sudden drop was sparked by just the rumor that Apple's COO was leaving the company.

2. AAPL now has a ridiculous 20% weighting in the most popular Nasdaq ETF, the Powershares QQQ Trust ETF (QQQQ).

3. The Nasdaq itself tanked at the open today.

Draw a straight line and it's obvious that a major Apple surprise would be enough to tank the entire market.

Is this kind of analysis going too far? Maybe. Or maybe it doesn't go far enough.

Join Josh Lipton for a closer look on Apple's incredible influence on the market and world at large.

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No positions in stocks mentioned.
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