Facing threat of United States tariffs, Apple loses top valuation crown to Microsoft

29 November, 2018, 08:00 | Author: Corey Lynch
  • The Microsoft sign is shown on top of the Microsoft Theater in Los Angeles California US. Reuters File

Microsoft had climbed over 3 percent at official trading session on Monday, when the market registered broad gains.

Due to a dip in Apple's stocks as a result of USA president Donald Trump's statements regarding the Cupertino giant, Microsoft briefly overtook Apple to become the most valuable company in the world.

That Microsoft is even close to eclipsing Apple - and did so briefly a few times this week - would have been unheard of just a few years ago.

Meanwhile, analysts are also anxious about potential impact on the firm from the US-China trade war, with the Trump administration not ruling out the possibility of tariffs being imposed on Apple's made-in-China products.

Apple obviously was in no mood to lose it again to Microsoft but as its iPhone sales were not as par with the expectation, the tech giant finally met the defeat by slipping one position in the list of the top US-based company. At the open, Microsoft had a market cap of $815.8 billion, compared to Apple's roughly $815.5 billion, according to Refinitiv.

Apple has slid amid growing concerns the company is seeing weak demand for iPhones, by far its biggest product line.

Microsoft, which is led by Satya Nadella and works in cloud-computing and other businesses, has lost a relatively modest 6.7% over that period.

Microsoft has its own share of problems, given the shrinking PC market as people increasingly opt for mobile devices, but it seems to be working its way around the issues better to find new growth avenues.

However, Apple's iPhone demand slowed down too, along with many other factors leading to the drop in market value.

That bet paid off. Windows is now a dwindling fraction of Microsoft's business. Just last month, Amazon and Google parent Alphabet were also ahead of Microsoft in market capitalization.

The success prompted many analysts to upgrade their target prices and recommendations on Microsoft stock, providing momentum to the counter.



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