- Dow up, but S&P and Nasdaq drop
- Apple falls on reports China could limit usage of i Phones
- Weekly jobless claims fall more than expected
4:08pm; Rate hike concerns persist
The Dow closed Thursday up 58 points, 0.2%, at 34,501, the Nasdaq Composite declined 124 points, 0.9%, to 13,749 and the S&P 500 lost 14 points, 0.3%, to 4,451. The small-cap Russell 2000 index slid 18 points, 0.9%, to 1,857.
The Nasdaq fell for the fourth consecutive session as fears that the Fed will raise rates one or more times have dominated investor sentiment this week.
"People were hoping the Fed would be on hold for the rest of the year, but it's possible that we got one or two more rate hikes to come," said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance. "All things being equal, that's a little bit of a negative for the stock market, which was expecting the Fed to potentially be done for the year."
Apple stock shed 3% on news that China plans to expand a ban on the use of iPhones in state-owned companies and agencies.
12:00pm: Nasdaq remains lower but Dow rallies
US stocks were mixed with tech stocks remaining lower hurt by falls in Apple and concerns of higher interest rates while blue chips found some favour with investors.
At midday, the Dow Jones Industrial Average was up 97.56 points, 0.3%, at 34,540.75, the S&P 500 was down 15.30 points, 0.3%, at 4,450.18 and the Nasdaq Composite was down 160.50 points, 1.2%, at 13,711.97.
Chris Beauchamp at online trading platform IG said: "It was unlikely to be a great open to the session for Wall Street with Apple suffering heavy losses."
"The news of a ban on iPhone usage by Chinese government officials wiped more than 3% off the tech giant, and cast a shadow over the entire market on a day when sentiment was already fragile thanks to fears about more rate hikes.”
9:40am: Nasdaq knocked lower by falls in Apple
Tech stocks headed south data showed the labour market remained strong and Apple nursed heavy falls on reports China could ban state employees from using iPhones.
Shortly after the opening bell, the Dow Jones Industrial Average was up 25.80 points, 0.1%, at 34,468.99, the S&P 500 was down 27.30 points, 0.6% at 4,438.18 and the Nasdaq Composite was down 198.22 points, 1.4%, at 13,674.25.
Apple Inc (NASDAQ:AAPL)'s shares extended Wednesday's falls on reports China may be setting limits on the use of iPhones by state-linked employees.
The Wall Street Journal reported Wednesday that China had banned government officials from using iPhones for work purposes, while Bloomberg said overnight that Chinese officials could extend that ban to government-backed agencies and state companies.
Shares of Apple opened 3.8% lower at $175.90.
New claims for US employment support fell by more than anticipated in the most recently ended week, figures the US Department of Labor showed.
Initial jobless claims totalled 216,000 in the week ending September 2, down from the previous week's upwardly revised level of 229,000.
The latest reading came below FXStreet-cited market consensus, which expected the claims figure to increase to 234,000.
The figures come a day after a strong services print from ISM and the Beige Book publication which showed modest economic growth continued through July and August.
While expectations are that the Federal Reserve will leave rates unchanged at its September meeting, the chances of a rate rise in November are increasing with the CME Fed Watch tool putting the likelihood close to 50/50.
7:00am: Nasdaq called lower on fears of higher rates
US stocks futures are pointing to a broadly weak start on Wall Street with tech stocks seen lower on concerns interest rates will stay inflated.
In pre-market trading, futures for the Dow Jones Industrial Average were 0.1% higher, while those for the S&P 500 fell 0.3%, and contracts for the Nasdaq 100 futures were down 0.6%.
A strong ISM services sector reading on Thursday pushed Treasury yields and the dollar higher.
The ISM's services PMI registered 54.5 points in August, up from 52.7 points in July, the eighth month of consecutive growth, and above the FXStreet-cited consensus of 52.5 points.
James Knightley chief international economist at ING Economics, noted the figures "surprised to the upside" and while not at very high levels are consistent with US growth accelerating in the third quarter.
"There are doubts as to how sustainable this will be, but the rise in the inflation component will keep hawks wary even if they do indeed go with the majority and vote for a pause on rate hikes in two weeks," he felt.
While 93% of interest rate traders foresee no change at September’s Federal Open Market Committee meeting, expectations of an additional interest rate hike at the November meeting rose above 40%, according to the CME FedWatch tool.
Today’s economic focus will be on weekly jobless claims as investors look for signs of chinks in the labour market.
Economists expect claims, considered a proxy for lay-offs, to have increased to 234,000 last week from 228,000 the previous week.
Elsewhere, Fed governor Michelle Bowman will appear on a panel on the future of money and consumer protection at the Philadelphia Fed’s annual fintech conference but will no doubt give a comment on two on the current state of the US economy.
Meanwhile, Boeing chief financial officer Brian West will speak at an industrial conference, where investors will be keen to hear about the aerospace and defence group’s return to delivering in China.