Berkshire Hathaway cuts its stake in Apple by half, causing a 7% drop in Apple shares.

Over the weekend, Warren Buffett stunned the investing community by cutting his substantial stake in half, resulting in a significant decline in the tech stock on Monday as the global market sell-off intensified.

Berkshire Hathaway's Apple holding was valued at $84.2 billion at the end of the second quarter, indicating that the Oracle of Omaha sold off a little more than 49% of the tech stake.

Apple's premarket trading saw shares drop more than 7% on Monday. Economic concerns of a slowdown have triggered a potential major correction in global stock markets.

In the second quarter, the 93-year-old legendary investor sold more than $75 billion in equities, increasing Berkshire's cash pile to a record $277 billion. Additionally, Buffett began selling his second largest holding in July.

Buffett had previously sold 13% of his Apple stake in the first quarter, citing tax savings as his motivation. However, the size of his second-quarter sale suggests there may have been other factors at play.

In 2016, Berkshire started investing in Apple under the guidance of Buffett's lieutenants Ted Weschler and Todd Combs. Over time, Buffett grew increasingly fond of the tech giant and significantly increased Berkshire's stake, making it the company's largest holding and declaring Apple the second-most important business after his insurance conglomerate.

The growth of Berkshire's Apple holding was so significant that it accounted for half of its equity portfolio, which may have influenced its selling decision due to portfolio management concerns.

In the second quarter, Apple's shares surged 23% to a new record high, fueled by renewed optimism about its AI capabilities.