US stocks: S&P and Nasdaq fall as Apple falls and unemployment data fuels interest rate fluctuations

The S&P 500 Index and Nasdaq fell on Thursday, with Apple and chip stocks falling on worries about lower iPhone sales in China, while a decline in weekly U.S. jobless claims fueled concerns about interest rates and ongoing inflation. Shares of S&P giant Apple Inc. fell for a second straight day after news that China tightened restrictions on iPhone use by government employees and forced employees at some government agencies to stop using the cellphones at work.

Bloomberg reported that China is considering extending the iPhone ban to companies and government agencies. Resistance from Apple, its suppliers, and companies with heavy exposure to China pushed the S&P 500’s technology sector lower, resulting in the largest percentage decline of the benchmark index’s 11 major sectors during the session.

A report from the U.S. Department of Labor shows that the number of Americans filing unemployment claims fell to 216,000 in the week ended September 2, reaching the lowest level since February. However, investors fear this would encourage the Federal Reserve to continue its tight monetary policy, putting pressure on stocks.

“The weekly reports were big news this morning, good news was interpreted as bad, and news from China was hard to ignore”; about Apple, said Sahak Manuelian, managing director and head of equity trading at Wedbush Securities. Investors are also cautiously awaiting August inflation data, which will be released next week. Due in part to the recent rise in oil prices, Manuelian pointed to “some concern among investors about a possible rise in inflation, which is not crazy.”

Bets that the Fed would leave interest rates unchanged in September were at 93%, although the likelihood of another recess at the November meeting was much lower. According to CME Group’s FedWatch tool, the percentage is 5%. “There is this tiny bottleneck that allows the Fed to make monetary policy tight enough, but not so tight that it ruins the economy. “It’s a tiny pupil, yet it remains partially open,” remarked Craig Fehr, the principal investment strategist at Edward Jones, characterizing Thursday’s descent as a prudent defensive position.

According to preliminary data, the S&P 500 fell 13, 94 points or 0.+31% to close at 4,451.54 points, while the Nasdaq Composite lost 123.64 points or 0.89% to 13,748.83. The Dow Jones Industrial Average climbed 60.44 points, equivalent to a 0.18% gain, reaching a level of 34,503.63.

The Dow Jones outperformed the S&P and the Nasdaq, with Apple ranking just 11th in the large-cap cyclical index, which is price-weighted to the market-cap-weighted S&P 500 index, in which Apple has one of the largest weights.
Defensive services outperformed S&P sectors during the session, as revealed by Edward Jones’039; Fehr noted another sign of risk aversion in the market on Thursday.

The Philadelphia Semiconductor Index fell as shares of Apple suppliers, including Skyworks Solutions, Qualcomm, and Qorvo, were down throughout the day.
Rick Meckler, partner at Cherry Lane Investments, said the news from China had drawn investors’ attention to the belief that “the U.S.-China relationship poses significant risk to current stock prices, particularly those in the technology sector.” Data showed that Chinese exports and imports fell in August.

U shares listed Chinese companies PDD Holdings, JD.com, Alibaba and Baidu also fell. The Dow Jones’ continued strength in the market is also due to the rise in McDonald’s shares after Wells Fargo upgraded the company’s shares to overweight. automation software company UiPath has confirmed its optimistic annual revenue forecast.

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