There might be enough of a market for them. There are plenty of watch companies selling thousand dollar watches that aren't functionally better than something you can get for a lot cheaper.
Even still, I don't think there's enough of a market for Apple to add billions in quarterly profit with something like this, much less hundreds of millions, so I'm not really sure why they want to get into this market.
Also, outside of sports watches or diving watches, I'm not even sure why most people bother wearing them. Having a cell phone has essentially replaced the only reason I ever bothered with one.
Even if they use NFC or something like that to make it interface with the phone so you can see emails or messages without getting your phone out of your pocket, is that really enough of a compelling use case that people would rush out to buy them? I don't think so.