Premarket: Apple is green

From the Wall Street Journal’s “Dow on Track for Worst Week Since January” posted early Friday:

Investors have gained some confidence that the Federal Reserve will act to curb rising inflation after policy makers signaled Wednesday that they expect to raise interest rates by late 2023. That has started to take the steam out of a recent rally in stocks linked to a broad economic recovery, leading to a retreat in banking and energy shares this week. It is also reviving appetite for technology stocks and other assets that could benefit from lower inflation and higher rates.

“If the Fed tapers bond purchases and it raises rates, then all of a sudden the inflation dragon gets tamed,” said Gregory Perdon, co-chief investment officer at private bankArbuthnot Latham. “If inflation gets tamed, you want to buy the long-duration assets,” or investments that are sensitive to interest rates, he added.

In the near term, Mr. Perdon expects inflation to creep higher, due to supply-chain bottlenecks, chip shortages, strong demand for goods and services and easing pandemic restrictions. Stocks are still likely to advance, he said.

“The Fed hasn’t done anything yet. All they’ve done is signal, and they’re a long way off from doing anything,” Mr. Perdon said. “Markets are supported by the trifecta of monetary and fiscal policy and the vaccine rollout. Markets may face a reckoning, but that won’t happen in 2021.”

My take: Meanwhile, bucking the rest of the market, Apple could make it three green weeks in a row.

One Comment

  1. Jerry Doyle said:
    As inflation seeps into the economy & the costs of financing escalates I can’t help believe that Apple’s zero financing strategy in purchases of its hardware pays dividends going forward. I long have taken advantage of Apple’s zero percent financing offering through the old Barclay Visa program & now through Apple’s direct zero financing program in conjunction with GS. Why shell out $1000 plus of my savings thus losing it as an investment option when I can have Apple shell the money out for me at no financing cost. I soon will be purchasing the new iMac 27 inch when it comes forward, a new iPad Pro, and perhaps a new iPhone & AirPod Max. Those purchases easily can top $6,000. That is six thousand that remains in my personal investment account due to Apple’s zero financing program. I often wonder the extent Apple’s zero financing program plays as a consumer incentive for making new hardware purchases. Apple makes the program simple by automatically deducting the monthly amounts from my financial account, or if one doesn’t choose that option then by notifying you of the monthly amount due. In addition, Apple Pay’s me $180 plus for making the purchases. A very nice program offering all the way around.

    June 18, 2021

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