U.S. index ETFs were mostly flat on Monday as Apple Computer fell hard and dragged major markets down with it.
Apple Computer (Nasdaq:AAPL) is a major player in U.S. stock indexes and ETFs since it’s the largest company in the world and often plays the roll of “tail wagging the dog.”
Apple (Nasdaq:AAPL) makes up 10% of the Nasdaq Composite, more than Google and Microsoft combined, 4% of the entire S&P 500 (NYSEARCA:SPY) and 20% of PowerShares QQQ, (NYSEARCA:QQQ) the leading Nasdaq tech ETF.
Apple’s problems spring from declining iPhone sales and from technical weakness since the company’s stock recently formed a “death cross” pattern, which is a widely respected “sell” signal.
For the day, major indexes and their related ETFs finished mixed. The Dow Jones Industrial Average (NYSEARCA:DIA) gained 0.14%, the S&P 500 (NYSEARCA:SPY) slipped 0.09%, the Nasdaq 100 (NYSEARCA:QQQ) dropped 0.46% and the Russell 2000 (NYSEARCA:IWM) lost 0.08%.
In addition to Apple’s (Nasdaq:AAPL) problems, things continue to be grim in Europe with 16 of 27 nations reporting yearly declines in industrial production. Read “Another Warning On European Industrial Production”
The other big news of the day came from Washington where the White House and Congress traded opening salvos over the upcoming debt ceiling debate. President Obama said he wasn’t going to negotiate over raising the debt ceiling while Senator Mitch McConnell and Speaker of the House Boehner seem intent on sticking with their plan to link every dollar in debt ceiling increase to one dollar in spending cuts.