Apple said it will increase its share repurchase program to $130 billion, up from $100 billion. The company also announced an 8% dividend increase to $3.29 per quarter, up 24 cents from the previous $3.05. Apple also announced a seven-to-one stock split, which will take effect on June 9. That would make the price of a single share of Apple significantly cheaper, paving the way for the company to possibly be included in the benchmark Dow Jones industrial average. Apple also handily beat Wall Street’s profit and sales estimates for the past quarter.
Investors love stock splits, which was evident in Apple’s 8% pop higher in Thursday’s session.
Russia: The Bad News
Financial markets hate uncertainty. Loose cannon Vladimir Putin is a source of great uncertainty. As shown in the chart of Thursday’s session below, stocks made an about face around 9:40 am EDT.
Russia-Ukraine is a story that remains on the market’s radar. From The Wall Street Journal:
Russia said it launched military exercises along the Ukrainian border on Thursday after Ukrainian forces killed pro-Russian militants and overran three roadblocks outside the eastern city of Slovyansk, in part of a renewed military operation to regain control. Russia’s Defense Minister Sergei Shoigu said exercises involving land and air forces along the border had already begun. Russia has had tens of thousands of troops massed along the border since last month and has threatened to intervene in Ukraine’s eastern region if it felt ethnic Russians there were under threat. Referring to the situation in Ukraine, he said that “if this military machine isn’t stopped today, it will lead to a greater number of dead and wounded.”
Investment Implications – Establishing Guideposts
The Dow has been consolidating for almost four months now, which tells us investor doubts about the economy relative to stock valuations have been increasing.