Submitted by Jon Reed on
After closing at an all-time high of $103.30 last Tuesday, Apple (NASDAQ: AAPL) share prices dropped off and closed at $98.97 on Friday. It will be interesting to see how tomorrow's big event will affect trading. We expect a slight drop off tomorrow, followed by another shortly after the iPhone 6 launch, following the historical trend of the stock price/iPhone launch relationship. Though this time things could play out differently, as Apple is also expected to announce its first wearable device (popularly, but unofficially, known as the "iWatch"), which is a brand new product category for the company.
In addition to the iPhone 6 and iWatch, several analysts, including KGI Securities' Ming-Chi Kuo, expect Apple to unveil the next generation iPad Air as well. It seems to us, however, that there is more than enough content for tomorrow's event, and the rumored October event seems a more likely setting for new iPad announcements.
There has been much speculation that the iPhone 6 will contain an NFC chip to facilitate secure mobile payments, and last week the Wall Street Journal concurred, adding that the iWatch will also be equipped with one. It's no secret that Apple has been avidly developing a mobile wallet, which lends credence to the NFC chip rumors. In fact, over the course of last week, Apple reached agreements with American Express, Visa and Mastercard. Ultimately these partnerships will allow customers to use their phones in place of credit cards to make transactions at brick-and-mortar retail locations. Apple also reached agreements with CVS and Walgreens and is apparently in talks with Nordstrom.
According to J.P. Morgan analyst Rod Hall (via AppleInsider), Apple's so called "iWallet" would not generate significant revenue for the company. It would, however, serve to lock customers into the iOS ecosystem, thereby making it less appealing to, say, change to an Android phone.
Apple reportedly also reached agreements with several large financial institutions last week to lower its card transaction fees. This will translate to big savings for the company, especially when its mobile payment platform deploys. For example, iTunes generated about $4.5 billion last quarter; with these new deals in place, Apple would save about $27 million.Apple last week hired legendary designer Marc Newson as Senior Vice President of Design under Jony Ive. Newson has in the past worked with Swiss watchmaker Jaeger-LeCoultre, perhaps he will be designing future iWatches.
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Early in August, California District Judge Lucy Koh rejected a $325 million settlement offered by Apple, Google, Intel and Adobe for wage fixing in order to avoid poaching. On Thursday, said companies filed an appeal, claiming the judge's decision was "rigid and formulaic." A hearing is scheduled for September 10th.