U.S. stocks are starting the second half of the year on the right foot, with the S&P 500 (SNPINDEX: ^GSPC ) and the narrower, price-weighted Dow Jones Industrial Average (DJINDICES: ^DJI ) up 1.15% and 1.10%, respectively, at 10:10 a.m. EDT.
It's an Apple morning
The Financial Times is reporting this morning that Apple (NASDAQ: AAPL ) paid no corporation tax in the U.K. in the year ending September 2012 (in the year prior to that, the tax bill was 11.4 million pounds). Tax deductions linked to employee share awards contributed to a zero net tax liability. This is bound to kick off another round of debate concerning the company's aggressive tax planning.
Meanwhile, on the business front, the iPhone maker has applied for a trademark for "iWatch" in Japan. The application was made on June 3, disclosed on the Japan Patent Office on June 27, and confirmed by a patent official today.
In fact, this isn't Apple's first trademark application for iWatch. At the beginning of last month, Russian newspaper Izvestia reported that the company had done so in Russia... before that, Apple trademarked iWatch in Jamaica last December.
Is the iWatch in the pipeline or is this just an elaborate "false flag" operation from Apple? This looks like a lot of trouble to go to just to create a diversion, although it's possible the company is simply acting defensively, i.e., scooping up the trademarks in order to be prepared, should the company decide to develop a watch. Here's what we know:
First, investors are clamoring for innovative new products that might give the shares new momentum. Last month's announcement of a new iPhone operating system, iOS, at Apple's Worldwide Developer Conference is nice, but it's hardly a game changer – which is what the market has come to expect.
Second, we know for a fact that Samsung, Apple's No. 1 rival in the smartphone space, is developing a device that is worn like a watch. It's unclear what the market for such a device is, as Apple CEO Time Cook himself told a group of technology and media executives a month ago. Despite that skeptical note, I'm not convinced that Mr. Cook is ready to concede that market, or even first-mover advantage on wrist-worn devices.
Third, The New York Times reported in February that Apple was tinkering with a wristwatch-type device with curved glass that would run on the iOS plaltform.
My conclusion: The evidence suggests the iWatch is on its way. If that is the case, it'll be very interesting to see what kind of market Apple can carve out/create.