Esperio: Investors Curb Their Appetite, Even for Rock-Solid Shares

European markets failed to follow the rise of Wall Street’s indexes on Wednesday as the S&P 500 broad market index and tech-heavy Nasdaq Composite Indexes gained nearly 2%. A downside tendency in fuel costs is seen to be unstable and, more importantly, is a sad sign of declining demand and recession threats, which in itself is a negative driver for stock investments.

Apparently, this is why the DAX 40 index of German blue chips did not follow up. A large 0.75% interest rate hike by the European Central Bank (ECB), which is trying to curb inflation, is limiting business options for refinancing or the consolidation of existing debts. Esperio analysts suggest that the popular strategies of selling upticks to minimise portfolio risks remain predominant for U.S. assets.

It is remarkable to see that even the price of rock-solid Apple shares added less than 1% following the announcement of the update for its smartphone flagship set. The management of the famous Cupertino-based company decided to keep previous pricing levels for all new iPhone 14 series stable despite inflationary pressure.

In order to boost its margins Apple abandoned its cheapest model, the iPhone mini, which means that consumers need to pay $100 more for the cheapest smartphone of the newly introduced Series 14. Investors doubt this trick will be enough to maintain the active customer base right now when households are struggling to save more money.

Other ways to increase sales for Apple is to distribute more products focused on outdoor activities, including the new Ultra Watch for sports like diving and triathlons and promoting new special features on their devices, such as using satellites to send emergency message even if users have no internet connection, as the service will be free for at least two years.

The rivals are working on similar functions. Tesla and SpaceX leader, Elon Musk, said recently that his companies are cooperating with T-Mobile to use Starlink satellites created by SpaceX to connect mobile phones directly to the internet. Yet, the technological decision proposed by Apple together with its satellite services partner Globalstar looks unique for the moment.

Especially for ladies, Apple has designed another useful function for its Series 8 Watch which measures the user’s temperature in order to track menstrual cycles and also calculates ovulation dates, while emphasising the need for privacy by providing access to this functionality with FaceID or password, and also when a user has a right to define what data would be shared.

Apple Watch chronometers have also been programmed to determine if the owner has been in a serious car accident, thanks to the interaction of the accelerometer, gyroscope, microphones and GPS.

The device automatically contacts rescue services and sends them the location as well as the sound from the microphone, which has acceleration force detection up to 256 G. All these functionalities work without an internet connection, and this function is called Crash Detection.

All together this would have ensured the price growth of the company's shares by at least 3-4% at once in the previous pre-inflationary environment, but now investors are seemingly limiting their appetites at a time when the conditions point to high general risks for the global economy and, therefore, for the average consumer's spending power.

Alex Boltyan, senior analyst of Esperio company.