Apple Stock Faces Correction Threat as Bond Market Yields Rise

Apple's stock price has been resilient in recent times due to its strong quarterly report. However, its short-term upside potential now depends on both Apple's own results and the bond market situation.

The US Treasury's decision to increase buybacks of long-term bonds initially pushed the 10-year yield down towards 4.65%, which was positive for AAPL and other highly valued companies. A lower discount rate increases the present value of future cash flows, but this effect is quickly fading as yields have returned to around 4.69-4.70%.

For Apple, with its high valuation multiple, rising yields may limit further upside and increase the probability of a correction if the stock does not receive a new catalyst from AI or the September launches.

The company's outlook for the September quarter remains positive but points to a slowdown, with total revenue expected to grow by 9-11% year over year. However, expenses continue to rise rapidly, mainly due to investments in R&D and AI, creating a mixed picture for investors.