America’s first interest rate hike in nearly a decade is here. The U.S. Federal Reserve raised its key interest rate on Wednesday from a range of 0% to 0.25% to a range of 0.25% to 0.5%.
“Perhaps unexpectedly, Apple is seeing big volume surrounding the Fed rate decision,” Jonas Elmerraji reports for TheStreet. “That’s because, with more than 20% of its market cap paid for in cash and short-term investments on its balance sheet, Apple’s treasury management has been a challenging situations during this low-rate environment. Even a small interest rate increase could materially impact just how much income Apple’s mountain of cash reserves throw off.”
“There’s also a technical story brewing in Apple right now. Shares had been in a well-defined uptrend since August, but they violated that uptrend last week,” Elmerraji reports. “That puts Apple’s ability to move higher in question — but it’s prudent to wait and see how the broad market reacts to the Fed decision today before calling the uptrend in Apple officially dead.”
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MacDailyNews Take: Technical, schmechnical. This is like steering a ship. We’ll wait to see how it all shakes out over the coming weeks and months.