DIGIVESTASI - Renowned investor Warren Buffett has announced a significant stock sale by Berkshire Hathaway Inc. (NYSE:BRK) in the second quarter of 2024, including a substantial reduction in its holdings of Apple Inc. (NASDAQ:AAPL).

In the latest report filed with the U.S. Securities and Exchange Commission, Buffett's investment firm, Berkshire Hathaway, revealed that it sold more than 389 million Apple shares during the second quarter. Despite the sale, Berkshire Hathaway still retains approximately 400 million shares of Apple.

In addition to Apple, Berkshire Hathaway also reduced its investments in several other companies, including Bank of America Corp. (NYSE:BAC), Chevron Corporation (NYSE:CVX), Capital One Financial Corp. (NYSE:COF), Floor & Decor Holdings Inc. (NYSE:FND), T-Mobile US, Inc. (NASDAQ:TMUS), and Louisiana-Pacific Corporation (NYSE:LPX).

Meanwhile, Berkshire Hathaway increased its investment in Chubb Limited (NYSE:CB) to 27,033,784 shares and Occidental Petroleum Corporation (NYSE:OXY) to 255,281,524 shares. According to a report from Yahoo Finance on Saturday (August 17, 2024), the company also made smaller new investments in aviation parts manufacturer Heico Corp. (NYSE:HEI) with 1,044,242 shares and cosmetics retailer Ulta Beauty Inc. (NASDAQ:ULTA) with 690,106 shares.

Buffett's investment decisions always draw attention due to his remarkable track record in the financial world. These latest moves were made amid a more than 20% rise in Berkshire Hathaway's stock this year. In early August, Buffett’s sale of nearly half of Apple shares was interpreted by Elon Musk as a sign of an impending market correction.

Global market fluctuations have also impacted Buffett's investments. Despite a significant drop, Berkshire's $20 billion investment in major Japanese trading companies has partially recovered. Japan’s interest rate hikes had a minimal impact on that investment.

Berkshire’s recent stock sales also boosted its cash reserves to a record $277 billion, despite the company’s net earnings in the second quarter falling 15.5% from the previous year, largely due to declining investment gains amid volatile market conditions.

Berkshire's decision to divest nearly half of its Apple shares in the first half of 2024 surprised many. However, Wall Street analysts are advising investors to remain calm and not be overly concerned.

Joe Gilbert, a senior portfolio manager at Integrity Asset Management, explained that Buffett's reduction in Apple shares is part of a risk management strategy. If Buffett truly doubted Apple’s long-term prospects, he would have sold his entire position.

Cathy Seifert, a research analyst at CFRA, added that the reduction in Apple shares might be aimed at taking profits and reducing concentration risk, given Berkshire’s still relatively concentrated portfolio.

This announcement comes amid broader concerns about a potential economic downturn. Disappointing jobs data last Friday raised fears that the Federal Reserve may have been too late in lowering interest rates, leading to a technical correction in the Nasdaq 100 Index and pushing the Cboe Volatility Index near the 25 level.

While Berkshire Hathaway’s sale of Apple shares has garnered attention, analysts emphasize that this is simply part of a risk management strategy and not an indication that Apple is facing long-term issues.

Find more news and articles on Google News