Apple is falling again

Apple stock is down by about 2% on Wednesday, bringing share prices down to roughly $US110 compared to Tuesday’s closing price of $US113.59.

Apple stock has been falling since the company reported earnings at the end of July. It’s down ~17% over that period.

There’s no immediately obvious reason for the stock to be down right now, but the decline does come as China has decided to devalue its currency.

China’s devaluation will increase production costs for Apple because it pays its local staff in US dollars. It’s also a signal that the Chinese economy is in trouble, which is bad since China is one of Apple’s biggest markets.

On Tuesday, firm KGI Securities wrote in a note that it foresees iPhone sales remaining flat or going negative in Q4 2015 — partially because of the recent changes in China’s economy and partially because it doesn’t think Force Touch will drive a lot of interest in the next iPhone.

Although Apple reported that it sold fewer iPhone units than analysts had expected in its Q3 earnings report, there’s reason for investors to remain optimistic. iPhone sales in general are up by 35% year-over-year, and Apple says only a small portion of its current installed base has upgrade to the iPhone 6 and 6 Plus. This means there are plenty of Apple fans using older models that will likely upgrade on the next cycle.

Here’s the chart from Yahoo Finance:

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