There seems to be two problems: First, the iPhone 5C, Apple's low-cost iPhone is actually going to cost $549 off contract. Investors were expecting $500 or less. Second, Apple made no mention of China Mobile, the big Chinese carrier that is supposed to give iPhone sales a boost.
Coming into the event, Apple's stock was off 1.32%. During the event it fought back, and was only down ~.32%. As soon as the event ended, the stock dropped.
The stock has bounced back after Piper Jaffray analyst Gene Munster said it's 99% certain Apple announces a deal with China Mobile tomorrow.