What happens when the stock market goes crazy and starts dumping value because of the market in China? If you're Tim Cook, you send an email to CNBC's Jim Cramer telling people to chill out. That's unheard of for Apple, and is probably a sign that—at least for a while today—the stock market really was that crazy.
Apple's message when the stock market went crazy: don't panic
China's economy has been having a rough go of it lately, and the government even devalued the local currency in hopes of getting the situation back under control. Apple investors have been especially concerned because of the big role China is currently playing in the company's value.
Tech stocks took a serious nose dive Monday morning thanks to China, and at one point Apple dropped below US$100. The company has since made back almost all of the value it lost, as have many other companies. For a few hours, however, the overall market was dropping fast.
With China at the heart of the drop, and with a big part of Apple's iPhone revenue coming from the country, Mr. Cook apparently felt he needed to go on the defensive. In his letter to Mr. Cramer he said,
I get updates on our performance in China every day, including this morning, and I can tell you that we have continued to experience strong growth for our business in China through July and August. Growth in iPhone activations has actually accelerated over the past few weeks, and we have had the best performance of the year for the App Store in China during the last 2 weeks.
That was Tim Cook's long winded way of paraphrasing the key message from Hitchhiker's Guide to the Galaxy: don't panic.
Offering up a mid-quarter comment on market performance is unheard of for Apple, and was likely a sign that the company's executives saw a serious problem brewing that they needed to get under control as quickly as they could. The email from Mr. Cook was intended to put investors at ease and reassure them that Apple's revenue wasn't taking a serious hit.
Monday's market correction wasn't anything new; markets around the world affect each other all the time, and occasionally that leads to sharp drops. Those markets can rebound, too, just as we saw later in the morning.
Still, Apple must've been seriously concerned about investor reactions for Mr. Cook to email Jim Cramer directly. That's the clearest indication of just how crazy Monday morning's stock market was.
Apple is currently trading at $104.95, down 0.81 (0.77%), and that's a lot better than its Monday morning opening price at $95.17.