Apple Inc. (AAPL) shares climbed higher on Wednesday, driven by a combination of positive news from the Federal Reserve and Foxconn’s advancements in the electric vehicle (EV) market.
The Federal Reserve made a significant economic move by implementing a 50 basis points interest rate cut, bringing the federal funds rate to 4.75%–5%. This unexpected reduction, the first in over four years, signifies the Fed’s growing confidence in managing inflation. The Fed also revised its economic growth forecast for 2024 downward to 2%. Inflation projections for the same year were also lowered, while unemployment rates were revised upward through 2026.
The updated Dot Plot suggests further interest rate cuts in the coming years, signaling a more aggressive easing approach compared to previous projections. This outlook indicates a significant shift from the Fed’s earlier stance and impacts economic projections for the next few years.
Meanwhile, Foxconn, a key supplier to Apple, continues to make strides in the EV industry. Foxconn, in collaboration with Sharp, recently unveiled the LDK+ electric vehicle prototype. This vehicle is designed to be a personal space with a room-like interior, highlighting the evolving role of vehicles in the autonomous driving era.
Foxconn has demonstrated strategic foresight by focusing on modular EV platforms, enabling cost-effective and unique model creation. The company has also approved a $246 million investment in Northern Vietnam for the manufacturing of EV parts, with operations slated to begin in January 2025. This investment emphasizes Foxconn’s commitment to expanding its production capabilities and establishing itself as a prominent force in the EV industry.
Apple shares closed Wednesday at $220.69, reflecting a 1.80% increase. This rise can be attributed to the positive economic signals from the Fed and the continued growth of Foxconn in the electric vehicle market, both of which are likely to benefit Apple in the long run.
