Why is Intel stock suddenly soaring today? New Apple chip manufacturing deal explained

The specific Apple products involved in the proposed manufacturing arrangement remain unclear. Intel declined to comment on the report, while Apple and the White House did not immediately respond to requests for comment.

If completed, the deal would mark one of the most important wins in Intel’s efforts to revive its manufacturing unit after years of losing ground to major global contract chipmaker TSMC.

In Apple’s most recent earnings report, CEO Tim Cook acknowledged that supply constraints were hurting iPhone sales. A second manufacturing partner could help Apple gain access to additional chip production capacity at a time when competition for advanced semiconductor production remains fierce.

TSMC currently produces advanced processors for major AI companies such as Nvidia and AMD, leading to ongoing shortages across the industry.

The semiconductor industry has surged in recent sessions as investors bet that strong economic growth will continue to support corporate earnings despite ongoing geopolitical tensions and uncertainty in energy markets.

“The economy is in much better shape than the doomsayers say,” said Chris Zaccarelli of Northlight Asset Management, according to Bloomberg. “There are a lot of headwinds — rising oil prices, high inflation and longer-term interest rates — but the labor market is adding jobs.”

“Shorts continue to point to limited gains, particularly in areas like semiconductors, but price action and momentum in earnings revisions remain the dominant forces driving the market higher,” Nationwide’s Mark Hackett told the publication.

Analysts also noted that strong economic data could make the Fed cautious about cutting interest rates in the near future.

“Strong data and inflation are likely to end any easing for the foreseeable future, although that could change based on developments in energy prices and the Middle East,” said Lindsay Rosner of Goldman Sachs Asset Management.