FT News Briefing

Arm’s share price goes crazy

Feb 14, 2024

11:32

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Investors adjust bets on US interest rate cuts due to strong inflation figures. Arm's share price skyrockets amid high demand for artificial intelligence. The war in Gaza strains the relationship between US President Joe Biden and Israeli Prime Minister Benjamin Netanyahu.

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Quick takeaways

Investors are uncertain about the timing of a US interest rate cut due to higher-than-anticipated inflation figures.

Arm's stock price surged due to limited availability, positive earnings, and investor interest in the AI narrative.

Deep dives

U.S. inflation slows, disappointing investors

Investors were disappointed as U.S. inflation rates for January were higher than expected, causing a sell-off in the market. The Federal Reserve had expected to cut interest rates three times this year, and with lower inflation rates, investors had predicted an earlier rate cut. However, with the higher-than-anticipated inflation figures, investors are now uncertain about the timing of the rate cut, leading to a negative market reaction.

Introduction

4min

Exploring the Factors Behind Arm's Share Price Surge

2min

The Power of Narratives and the Strained Relationship Between Biden and Netanyahu

2min

Analysis of the Israel War and Biden-Netanyahu Relationship

4min

Investors scaled back bets that the US Federal Reserve will begin cutting interest rates in May, and Arm shares soared after the UK chip designer reported higher revenues boosted by strong demand for artificial intelligence. Plus the FT’s Felicia Schwartz explains how the relationship between US President Joe Biden and Benjamin Netayahu, prime minister of Israel, is being affected by the war in Gaza.

Mentioned in this podcast:

Investors scale back bets of May rate cut on strong US inflation figures

Unhedged newsletter: Is Arm really an AI stock?

Unhedged podcast

Arm’s an AI stock now. When’s the crash?

The FT News Briefing is produced by Fiona Symon, Sonja Hutson, Kasia Broussalian and Marc Filippino. Additional help by Sam Giovinco, Peter Barber, Michael Lello, David da Silva and Gavin Kallmann. Our engineer is Monica Lopez. Topher Forhecz is the FT’s executive producer. The FT’s global head of audio is Cheryl Brumley. The show’s theme song is by Metaphor Music.

Read a transcript of this episode on FT.com

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