Change of guard seen as Apple (briefly) rules Wall Street

US stocks rebounded on Tuesday, with the Dow up by 429.92 points,following a Federal Reserve announcement that it would hold short-term interest rates near zero but that it would not take additional steps to encourage economic growth.

The day of volatile trading was also punctuated by an unexpected development: Apple Inc. became the most valuable public US company-if only temporarily. The tech company bested Exxon Mobil Corp. for the market’s top spot for most of the afternoon by as much as $7 billion.

By the time the closing bell rang, however, Apple returned to second place, just behind Exxon. The iPad and iPhone maker’s stock had gained 5.9 percent to $374.01 on Tuesday, bringing its market capitalisation to about $347 billion at the market’s close; Exxon stock closed up 2.1 percent at $71.64, putting the oil company’s market cap at $348 billion.

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Valentines for Jobs

Apple’s performance on Tuesday had market observers projecting that the tech titan will likely overtake Exxon again soon.

[caption id=“attachment_57700” align=“alignleft” width=“380” caption=“Since Apple launched the iPod in 2001, Apple shares have risen 4,000 per cent! Beck Diefenbach / Reuters”]  [/caption]

And with Apple wearing the market capitalisation crown for a good period of time on Tuesday, plenty of praise was heaped on CEO Steve Jobs, who is credited with turning around a nearly bankrupt company in 1997, and for ushering in an era of tremendous growth.

Jobs is responsible for engineering the “company’s comeback by honing Apple’s industrial design, tightly integrating software with hardware, and pushing into new markets, such as phones, music and tablets,” according to Bloomberg.The Wall Street Journal also noted that since the iPod was introduced in 2001, Apple shares have risen by nearly 4,000 percent. Additionally, Apple shares have climbed more than 12 percent this year, fuelled by sales of the iPad and iPhone, and a burgeoning business in China.

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Analysts were also bullish. “Apple is one of the few stocks I feel good about,” Alpha One Capital’s Dan Niles told The Street. “Apple is making great products that people want to buy… And as far as growth, there’s still a long way to go in terms of market share gains with the iPhone and iPad.”

Change of the guard

Apple is gaining at a time when Exxon’s shares have dropped by about 7 percent amid the recent drop in oil prices.

“Two things that I would definitely say have hurt Exxon are lower oil prices and its increasing reliance on natural gas,” Philip Weiss, an analyst at Argus Research, told Bloomberg.

But some market watchers say that the development ultimately reflects a symbolic changing of the guard.

“Technology is what people understand now,” Robert Pavlik, chief market strategist at Banyan Partners told Reuters. “So I think it’s sort of indicative of our society.”