UPDATE: Reuters has now withdrawn its report, citing "substantial changes" to the original story in China.

Apple has shot down claims that it is set to make a "cheap" iPhone for developing markets.

Reports of the low-cost iPhone had appeared in the Wall Street Journal, Bloomberg, and other tech news sites.

It had been reported the device could cost around $150, and would be mainly targeted at customers in China.

But speaking to reporters in Shanghai, Apple's SVP of Worldwide Marketing Phil Schiller denied the rumours.

Translations of local news reports by Reuters quoted Schiller as saying:

"Despite the popularity of cheap smartphones, this will never be the future of Apple's products. In fact, although Apple's market share of smartphones is just about 20%, we own the 75% of the profit."

Despite the quote, it is still possible Apple is trying to make a less expensive iPhone - but the chances of it being a visibly low-cost model seem to be non-existent.

Still, Apple CEO Tim Cook still insists that China is a big market for the company - and could even overtake the US in terms of revenue.

Also speaking in China, Cook said China could be Apple's top market.

"China is currently our second largest market. I believe it will become our first. I believe strongly that it will," Cook said.