first three days on the market. Some analysts suggested that investors also sold shares of Apple amid uncertainty over ongoing fiscal negotiations in Washington. If no agreement is reached on the issue, higher tax rates on dividends and capital gains are possible in 2013. Investors who had hoped for a special dividend this year, as many other corporations have announced on expectations of higher
tax rates next year, may be disappointed as time is running out. "If you were expecting a special dividend by year end, that's less likely to happen because its Dec. 5," said Colin Gillis, an analyst with BGC Partners.
The fear of higher taxes on capital gains also has prompted some investors to lock in profits now, particularly on a stock like Apple, which has posted gains of at least 25 percent forfour consecutive years.
"Depending on what happens with the (U.S. Fiscal negotiations), rates could rise next year or they could stay the
same," said Battle, of Performance Trust Capital. "They will not be lower, so if you're an investor who has seen gains in Apple, it is better to take those gains this year rather than next." Tax selling "can take a life of its own," said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York.
"Some taxable investors take the gains, that creates some negative momentum, institutional investors are heavily weighted the stock and reduce exposure."
Some market participants also cited reports by media including CNBC, which Reuters could not confirm, that margin requirements on the trading of Apple stock had been raised by at least one clearing firm.