The status of one of the four largest technology giants – Apple does not cause concern among experts in the field of finance. Despite the unfolded trade war between the United States and China over the past year and a half, the multinational company from Cupertino, Apple will retain position and continues to develop. The company’s management announces the release of new products, and the giant’s shares continue to grow.
Why Apple will retain position?
China is the main global supplier of rare earth materials, which are widely used in the production of high-tech products, which could not but affect many players in this market. However, the governments of both countries are going to continue bilateral negotiations on softening tariffs on raw materials and other products. Stock markets react positively to the prospect of opportunities for consensus between the parties to the trade conflict.
In turn, Apple is well versed in market waters and despite the complex dynamics of underwater market currents, Apple is firmly on its feet, which allows experts to continue to expect positive dynamics in the value of the company and its shares, many of them believe that Apple will retain position. Since the technology giant maintains a leading position in the industry, and also holds a more favorable position compared to other companies in the technology industry. In addition, the company’s interaction with the US government further enhances its sustainability.
Professional investors predict that even if the two most powerful economies in the world do not reach consensus at the next stage of negotiations and trade wars continue, Apple will retain a position in the production and sales of its products, as well as in profit for its investors, due to the possibility of maintaining the cost of materials for the production of new company products. This preservation is due to the fact that the timing of tariff changes allows the company to get time to ensure the production of a new line of the iPhone series with materials at the old tariffs.
Such a positive outlook directly affects the value of technology giant shares, which continue to grow. At the beginning of this week, the price of one stock of Apple reached $ 206.49 per share, which directly affected the growth of the Dow Jones Industrial index. Experts see this as an opportunity for Apple to retain its position and exceed the expectations of investors whose concerns about a possible decline in company profits due to China’s increase in tariffs on raw materials used in the production of Apple products have taken place.
Leveling the effect of a likely increase in tariffs gives the technology company a big advantage in the struggle for the share of the American market and maintaining the same price for domestic consumers. In addition, many finance professionals are confident that Apple could have a positive impact on the negotiations and outcome of the trade war for the two sides of the trade conflict. Since the tightening of tariffs will directly affect Chinese consumers, which is not beneficial to both parties.
Recall that between the two most powerful economies in the world, a tariff war unfolded after Trump’s statements in early 2018 about tightening economic policies against Chinese manufacturers, which were caused by a desire to protect the interests of American manufacturers and lobby their interests in domestic markets. Interest rate futures rose in the US last week, mitigating the impact of China’s tariff hike in response to new US import tariffs.
In turn, after the leadership of the Federal Reserve System announced that in the first month of autumn a discussion would be held on the possibility of lowering the interest rate, the cost of futures of federal funds went up. In this regard, traders who deal with these assets report a revival in the market, expecting a decrease in the interest rate from a quarter to a half point.
Trade wars between the US and China continue, and therefore, investors’ expectations in the technology sector are not the most positive, but experts predict that one of the American technology giants will maintain and strengthen its position