Apple overtakes Microsoft as world’s most valuable company
Apple has overtaken Microsoft to become the world’s most valuable company after breaking its silence on artificial intelligence (AI) and on the back of lighter than expected US inflation figures.
Apple shares rose nearly five per cent to a new record high of $218.02 per share on Wednesday, pushing higher than it did during its seven per cent rally on Tuesday, and driving the iPhone maker’s market capitalisation to $3.31 trillion (£2.58 trillion).
The stock has risen over 17 per cent during the year to date, while Microsoft has jumped over 18 per cent, with its market cap sitting at $3.26 trillion (£2.54 trillion). Google owner Alphabet is up nearly 28 per cent in the same period and is worth $2.19 trillion (£1.7 trillion).
It comes after Apple announced long-awaited AI news at a conference on Monday, introducing a range of new features. These include a revamp of its voice assistant Siri, which can now interact with messages, emails, calendar and third-party apps, integration with OpenAI’s ChatGPT and new customisable emojis.
“The iPhone maker has been the laggard among the mega-cap tech names this year due to concerns about sales of its core product in China and being left behind in the AI race,” said Dan Coatsworth, investment analyst at AJ Bell.
“The former issue has still to be resolved, but progress with AI means it is now seen as a catch-up candidate, hence the rally in the share price,” he said.
“The combination of clarity on how Apple intends to embrace AI and Oracle reporting big demand for AI-related activities has given investors something new to talk about and two different ways to play the theme instead of relying on chip giant Nvidia,” Coatsworth added.
It also follows lighter than expected US inflation figures. Although inflation has slowed to 3.3 per cent, it still sits well above the two per cent target, making a rate cut at the Federal Reserve’ policy decision on Wednesday evening unlikely. The Fed is expected to hold steady at 5.25-5.50 per cent, where it has lingered for almost a year.
A combination of Apple’s rally and cooled inflation drove the Nasdaq and S&P 500 to record highs on Wednesday. The Nasdaq Composite rose 1.7 per cent and the S&P 500 1.1 per cent.