(MENAFN - The Peninsula) Apple shares fell below 400 yesterday after comments from market analysts suggesting the iconic gadget maker is losing momentum.
At midday, shares were down 3.3 percent at 399.73, extending the downward trend since last September when Apple topped 700.
A research note from the brokerage firm Jefferies said Apple is likely to cut production plans for the iPhone to 25 million to 30 million in the third quarter, down from 40 to 45 million, and trim production in the fourth quarter to 50 to 55 million, from 60 to 65 million.
"Our survey of several hundred Orange, Vodafone, and EE stores in the UK indicates that inventories are elevated for iPhones and the Samsung Galaxy 3," said Peter Misek at Jefferies.
Misek added that "memory module makers have recently been reallocating orders in the third quarter away from Apple and toward emerging market players."
The analyst said production of a new iPhone has not commenced yet "but we believe it is about to begin," adding that he expects a new "iPhone 5S" updating the current model and a "low-cost iPhone" to launch in September.
A separate note from Trip Chowdhry at Global Equities Research said the lower share price and eroding market share are creating a vicious circle for Apple, prompting some employees to jump ship.
"Recruiters are seeing more and more employees from Apple applying for jobs at Google, LinkedIn, Facebook and even HP (Hewlett-Packard)," he said
"Employees are viewing lower Apple Stock price as an indication of a bleak future for Apple."
Chowdhry said Apple's move to pay a dividend with a bond sale, in an effort to boost its share price, appears to have backfired.