Saudi Aramco has become the most valuable company in the world, surpassing Apple, this is according to Wednesday’s trading session.
In dollars, Saudi Aramco’s market valuation on Wednesday was just under $2.43 trillion, according to FactSet. Apple, the iPhone maker is now worth $2.37 trillion, following a drop of more than 5% on Wednesday during American trading.
On fears of a deteriorating economic environment, investors are selling off stocks and oil prices in several industries, including technology. On Jan. 4, Apple’s share price peaked at $182.94. Since then, the price has fallen nearly 20%.
Though mostly symbolic, the move is indicative of the shifts taking place in markets amid rising interest rates, inflation, and supply chain problems.Saudi Aramco shares have risen more than 27% so far this year.
A booming oil market boosted the oil giant’s profits by more than twofold last year, according to a March report. Despite the higher oil prices, which are great for Aramco’s profits, the Fed is forced to raise interest rates at the fastest rate in decades due to rising inflation.
NewsBeatng reports that higher interest rates lead to investors discounting future revenues from tech companies, lowering their stock prices. Companies like Aramco are benefiting significantly from this climate of panic selling in technology and other high-multiple names.
The money coming out of those names seems to be going to energy, which for now, has a positive outlook, given commodity prices.
A number of high-multiple companies, such as tech companies, are seeing panic selling, and the money is headed for energy stocks, which for now have a favourable outlook, given commodity prices.
