The group of actions known as “The Magnificent Seven“—responsible for much of the overall market gains in recent years—has seen ups and downs this year. However, the strength of the big tech companies is notable.
The last highlight is Meta Platformsthe parent company of Facebook, which ended Tuesday at an all-time high. Apple’s performance is also impressive, closing at an all-time high, even though few people seem impressed with the new iPhone’s AI features. The technology-focused Nasdaq index also closed at a record. The question is how long this incredible rally can last, or what could stop it.
Apple stock extends rise despite lukewarm enthusiasm for its iPhone 16 and its promised artificial intelligence features. The stock hit another 52-week high, rising in six of the last seven trading sessions. His rise is fueled by his status in “The Magnificent Seven,” as is Meta Platforms’ stock, which hit an all-time high.
Apple has maintained its place as the world’s largest company by market value, at $3.668 trillion, according to Dow Jones Market Data, and the stock is up 26% this year. The stock is rising despite reports that iPhone sales are lagging behind competitors and consumers seem unimpressed by AI features.
Wedbush senior equity analyst Dan Ives says Apple’s prospects are better than recent skepticism suggests, telling Barron’s that the Street is starting to realize the iPhone 16 is the start of a supercycle sales and that sales in China appear strong, “sending the bears into hibernation.”
Separately, Benoit Dupin, Apple’s director of machine learning and AI, said the company is using Amazon Web Services’ custom AI chips for search and other services, and is considering using its latest AI chip for pre-training. models like Apple Intelligence, according to CNBC.
Shares of Meta, the parent company of Instagram and Facebook, have been rising since Nov. 18, and are up nearly 8% since CEO Mark Zuckerberg had dinner with President-elect Donald Trump on Nov. 27. The rise of technology stocks has helped lift the S&P 500 and Nasdaq to new records.
What’s next?
Ives, who rates Apple stock “Outperform” with a $300 price target, expects iPhone 16 sales to kick off an AI-powered supercycle that will break the annual iPhone sales record, encourage 90 million users to upgrade their iPhones and will help Apple reach a market value of $4 trillion by 2025.
Powell’s last chance
Federal Reserve Chair Jerome Powell is about to give his last publicly scheduled comments on the state of the economy later today, ahead of the central bank’s final rate-setting meeting of this year. More recently, he said there is no rush to lower rates, and the Fed’s preferred inflation rate has not yet fallen to the 2% target.
Powell will be interviewed at the New York Times DealBook Summit today at 1:40 pm ET. That will give investors another look at his views before a period of silence begins ahead of the Fed’s Dec. 17-18 meeting.
Futures traders put the probability of a quarter-point rate cut this month at nearly 73%, according to CME’s FedWatch tool. That’s up from 59% just a week ago. Another cut would be the third in a row and would reduce the Fed’s benchmark rate by one percentage point for the year.
The November jobs report will be released on Friday, while the November consumer price index will be released on December 11. A stronger-than-expected jobs report or a higher-than-forecast inflation reading could push Fed officials to support a pause in rate cuts rather than another downward move.
Source: Ambito
