Why Apple may actually be early to implement useful AI technology

By Philip van Doorn

Also, Apple's bonds, Musk's money, how to limit stock-market-concentration risk, and the Moneyist's advice for escaping a debt trap

This week Investors showed how thrilled they were with Apple Inc.'s Worldwide Developers Conference on Monday, when executives described several artificial-intelligence initiatives for the iPhone.

Yes, the stock fell 2% that day. But shares of Apple (AAPL) were up 10% through Thursday's close from a week earlier, putting it back on top as the most valuable U.S. company.

The MarketWatch Companies team provided live coverage of Apple's WWDC with detailed commentary, including the list of iPhones that will be able to run iOS18, which will be able to take advantage of Apple Intelligence. Therese Poletti explained what investors may have overlooked during their initial sour reaction to Apple's announcements.

Here are some of the reactions to Apple's AI announcements at its WWDC.

Cody Willard: Apple Intelligence today is like seeing the first iPhone back in 2007. You know great things are coming.'Definitely hold on to your Apple position,' says 'Big Short' investor Steve Eisman

Apple can also be an income play

Do you think high interest rates will last forever? Think again. It is in the government's interest to hold down its borrowing costs and the Federal Reserve is making progress in its effort to quell inflation.

This is why locking in yields of more than 5% on some of the highly rated bonds issued by Apple might make sense for investors who want income, as Ciara Linnane explained.

Stock market concentration risk is increasing - here is what you might do about it

Take a look at this list of the top 10 holdings of the SPDR S&P 500 ETF Trust SPY, which is designed to track the performance of the S&P 500 SPX. The ETF and index are weighted by market capitalization. The list is as of Thursday:

   Meta Platforms Inc. Class A       Ticker  SPY portfolio weight 
   Microsoft Corp.                    MSFT           7.2% 
   Nvidia Corp.                       NVDA           7.0% 
   Apple Inc.                         AAPL           6.8% 
   Amazon.com Inc.                    AMZN           3.7% 
   Meta Platforms Inc Class A         META           2.4% 
   Alphabet Inc. Class A             GOOGL           2.3% 
   Alphabet Inc. Class C              GOOG           1.9% 
   Broadcom Inc.                      AVGO           1.6% 
   Berkshire Hathaway Inc. Class B   BRK.B           1.6% 
   Eli Lilly and Co.                  LLY            1.5% 
   JPMorgan Chase & Co.               JPM            1.2% 
                                       Source: State Street Corp. 

There are actually 11 stocks on the list for 10 companies - two common share classes of Google holding company Alphabet Inc. (GOOGL) (GOOG) are included in the index and in SPY. Together these stocks made up 37.2% of SPY.

Not only is that a high level of concentration for 10 out of 500 companies, but it is unusual to see three companies (Microsoft Corp. (MSFT), Apple and Nvidia Corp. (NVDA)) having weightings of more than 6% each.

For this week's ETF Wrap newsletter, Christine Idzelis interviewed executives at Goldman Sachs and JPMorgan Chase who discussed the heavy index weighting of large technology companies and explained what investors can do to mitigate concentration risk.

Related: Popular tech-sector ETF could see major shakeup as Apple, Microsoft and Nvidia jockey for position

How to make money from meme stocks

If you buy shares of a money-losing company in the hope that buzz in a Reddit conversation will be enough to send its shares higher, you might get lucky and make a killing, or you might lose your shirt.

But what if you run GameStop Corp. (GME), which lost $32.3 million during its most recent reported fiscal quarter, but an improvement from a $50.5 million loss a year earlier? Barbara Kollmeyer and James Rogers explained how a corporate board can garner billions of dollars from the renewed meme-stock craze. And Joseph Adinolfi had some ideas about how they might spend the money.

More:

GameStop's stock continues rally as Roaring Kitty grows stakeRoaring Kitty doubles down: Latest update shows trader grew GameStop stake to over 9 million shares

The Moneyist and the debt trap

Quentin Fottrell - the Moneyist - often helps readers work through family conflicts over money. This week he helped a woman with $68,000 in credit-card debt who felt "paralyzed." He offered practical advice to clean up her finances and suggested a way to avoid falling into another debt trap.

More help from the Moneyist:

'We, his children, do not trust her': My elderly father is recently widowed. His new girlfriend is putting him under pressure to get married. What can we do?'He always managed to play golf': My husband of 14 years never worked and now we're divorcing. He wants half of my $1 million home. What can I do?I'm leaving my financially irresponsible daughter $500,000. How can I do this without her squandering her good fortune?

What if you cannot trust anyone else to handle your money?

When a couple is in their 70s, they might plan ahead by setting up a trust so that if they reach a point when they cannot handle their financial affairs, a child or other trusted family member might take over. But family life can be complicated. Beth Pinsker helped a couple who each had a child from a previous marriage. They were concerned that if one of them were to die, a surviving child might not be motivated to serve the best interests of the surviving stepparent.

Here is what they can do to set up a sound financial plan.

Tesla shareholders have a lovefest with Musk - but he still might not get that big pay package

On Thursday, shareholders of Tesla voted by a three-to-one margin to approve a $56 billion compensation package (mainly stock options) for Elon Musk, which the company's board of directors had approved in 2018, only to have the arrangement thrown out in January by a Delaware judge.

Claudia Assis explained why Musk will still have to fight for that money, despite the vote.

Therese Poletti: Tesla's scare tactics worked to win shareholder approval of Elon Musk's pay, but problems remain

Barron's: This Chart Shows How Elon Musk's $56 Billion Stacks Up to Other Big Pay Packages

This is how much more difficult it has become to buy a first home

Aarthi Swaminathan broke down the numbers, including median costs, interest rates, credit scores and even the size of a home, to show how the U.S. residential home-buying scene has changed over the past 10 years.

How risky are office buildings to banks?

There has been a flurry of warnings that regional banks might be threatened by exposure to commercial real estate loans secured by office properties. But some important information seems to have been overlooked. Here's a breakdown of office real-estate exposure for large banks, with estimates on how the shake-out for these properties might affect the lenders over the next two years.

From Joy Wiltermuth:

A look inside a $1 billion real-estate bet on the future of San FranciscoAs Fed stands pat on interest rates, there are 'a lot of zombie banks out there'

Artist explains how he created the NBA logo, featuring Jerry West

Jerry West, an outstanding NBA player who went on to have a successful career as a coach and executive for the Los Angeles Lakers, was 86 when he died Wednesday. Charles Passy interviewed Alan Siegel, an artist who has created brand images across industries, who explained why he selected West's image to create the NBA logo.

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-Philip van Doorn

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06-15-24 0512ET

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