Apple falls 20% this year, loses world-leading market cap and overtakes Aramco

Saudi Aramco became the world’s largest company by market value on the 11th. (Reuters)

Apple(Apple) handed over the throne to the world’s largest company by market value on the 11th, and the new king is Saudi Aramco. Tech stocks have been hit hard by rising inflation, while high oil prices have raised eyebrows from crude-producing companies.share priceThis has changed and the second has increased, and the global market capitalization ranking has been reshuffled accordingly.

Shares of Aramco hit a record high on Wednesday with a market cap of nearly $2.43 trillion, surpassing Apple for the first time since 2020. Shares of Apple closed the same day down 5.2% at $146.5, with a market cap of $2.37 trillion.

Bloomberg said that even though Aramco’s No. 1 crown may not last long and Apple will take the crown soon, Wednesday’s ranking change underscores the major strength of the global economy.

Aramco benefits from rising oil prices, but pushes inflation further, Fed forcedrate increase, Higher interest rates have made more investors look bad on the future revenues of technology companies, which in turn has dragged down the stock prices of technology stocks.

“Apple cannot be compared to Aramco in terms of business model or fundamentals. But factors such as inflation and tight supply have improved the outlook for commodities,” said James Meyer, chief investment officer at Tower Bridge Advisors.

Apple’s market cap was as high as $3 trillion earlier this year, nearly $1 trillion more than Aramco’s market cap at the time. Since then, however, Apple’s shares have fallen about 20%, while Aramco has gained 28%.

Tim Grisky, senior portfolio strategist at Ingalls & Snyder, believes it may take a little longer for technology companies to regain their crown this time around. After all, the Fed is preparing to raise interest rates by at least 150 basis points this year, and the Russian-Ukrainian war is yet to be resolved. “Many technology stocks have experienced panic selling, and the inflow of money has clearly shifted to energy stocks, mainly because they are bullish on the price of related commodities, and energy stocks have turned handsome.” Companies like Aramco clearly benefit from this environment, Grisky said.

In addition to rising inflation and interest rates, when Apple recently announced its earnings report, it also emphasized the plight of a tight supply chain. However, Apple’s performance is still growing steadily, and its balance sheet remains strong. It is still a relatively safe choice among technology stocks. The market believes that this year’s decline will not be huge, and this year’s decline is even less than the Nasdaq 100’s 24.8% fall this year.

In terms of US companies, Apple is still the number one market capitalization; Microsoft ranks second with a market cap of $1.95 trillion.

The S&P 500 energy sector is up 40% so far this year, with Occidenta the top performer, up 107%. Brent crude, which was around $78 a barrel at the beginning of the year, has now risen to $108 a barrel.

“When buyers are in a bear market, they are not tempted by fair valuations, they are looking for a bargain,” said the mayor of Tower Bridge. “I think buyers will hold on until prices are more attractive.”

Apple stock price hike

Of earlier

International oil prices rose 5% as US fuel inventories fell and Russian gas exports to Europe dwindled

finance .

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