CUPERTINO -- Apple (AAPL) shares plunged to a five-month low Wednesday in the midst of a postelection sell-off, pulling shares to 20 percent below the peak reached less than two months ago, which investors term a "bear market."
Apple shares fell as low as $556.04 in the morning session of Wednesday's trading day, the lowest price for Apple shares since June 4, 4.6 percent lower than Tuesday's closing price and 21.1 percent lower than Apple's peak price of $705.07, reached on Sept. 21, the launch day of the iPhone 5.
Apple stock suffered after the iPhone 5 launch despite sales of 5 million units in the first three days of availability because Apple was not able to meet demand for even more of the smartphones, as production issues kept them from providing more of the devices.
The tech titan then introduced a new, smaller iPad dubbed the iPad Mini and a fourth-generation full-sized iPad, but those developments failed to stoke the stock higher, as has happened in the past. Apple announced it sold 3 million iPads in three days after the new tablets debuted on Friday, but that resulted in only small gains that were erased in Wednesday's fall.
Wall Street uses two indicators to show a stock in major decline -- a correction, which indicates a drop of 10 percent, and bear market, a drop of 20 percent. However, Apple already exhibited big losses earlier this year, dropping 16 percent at one point in the spring, but bounced back to set a record for largest U.S. market capitalization in history. The company is still easily the most valuable company in the United States in terms of market capitalization, the total worth of all its shares.
However, bad news has piled on Apple lately. On the same day it announced 3 million iPads sold in three days Monday, IDC released a report showing the company's market share for tablets dropped considerably in the third quarter of 2012, from nearly two-thirds of the market to barely a majority.
Meanwhile, Samsung -- the South Korean tech giant with which Apple has battled extensively in court, claiming the maker of Galaxy tablets and smartphones copied the iPad and iPhone -- posted the largest percentage in the market for any company not named Apple since the iPad was introduced.
That news followed an executive shake-up that included the exit of iOS chief Scott Forstall, the software executive that had been with the company since cofounder and former CEO Steve Jobs brought him over from NeXT, the company he founded and then sold to Apple during his time away from the company.
Wednesday morning, the bad news continued: Bloomberg News reported on Twitter that Apple lost a court case involving its FaceTime program, the popular video-chat software available on iPads and iPhones. Apple was ordered to pay $368.2 million to Virnetx for infringing on the company's patents, Bloomberg reported.
Apple shares rebounded slightly by the end of the morning session Wednesday at 9 a.m. Pacific time, when they were trading for $563.36, a decline of 3.3 percent from Tuesday's closing price. Apple was not alone, as all three major stock indexes declined more than 2 percent Wednesday morning.
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