Post-"Orgy" And Huge Nasdaq Bite, Apple's Stock Emerges Unscathed

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Reading the headlines a month ago, you would have thought Apple’s insane run in the stock market was over. “Apple Crunched in Nasdaq Rebalance,” read the key Wall Street Journal headline. But the reality of the situation was much calmer. And actually, Apple ended up a little ahead of where they were when the news first hit.

Here was the situation: because Apple’s stock had risen so quickly over the past couple of years, it was accounting for a full 20.5 percent of the Nasdaq 100 index — a hugely traded collection of 100 stocks on the market. To put the percentage in context, Google was accounting for just 5.8 percent of the index, and Microsoft just 8.3 percent. So the Nasdaq decided to rebalance the index to lower Apple’s influence.

Apple’s weight was set to be shaved all the way down to 12.33 percent on May 2, today. Not surprisingly, many were quick to jump to the conclusion that this was bad for Apple — potentially really bad. After all, the news essentially meant that if a big fund had $1 billion invested in the Nasdaq 100, what was $200 million for Apple would now be just $120 million or so (with most of the other stocks in the fund like Microsoft and Google getting a larger share of that money as a result).

But when trading ended today, it became clear that the big bang was barely a whimper. Apple’s stock ended the day down just 1 percent. Friday, the final day of old balance trading, was the much more tumultuous day. On that day, an “orgy” of trading in milliseconds saw billions of dollars move.

But all told, Apple’s stock is still actually up from when the rebalancing news was first announced on April 5. On that day, the stock was trading around $340 a share. Today, it closed at $346 a share. And Apple’s market cap remains in the stratosphere at $319 billion — second to only Exxon among publicly traded companies.

It would seem those that believed that this rebalancing might actually be good thing for Apple because it would give them more room to grow, may have been correct.

Still, while it looks like it was all snapped back up, it would sure be interesting to know who sold $2.1 billion worth of Apple stock in one second on Friday.

[image: flickr/JoeLodge]