Josh White Sharecast News

12 Sep, 2023 22:44 12 Sep, 2023 22:43

US close: Stocks in the red as tech plays lead losses

dl apple iphone macbook technology consumer electronics pb — AppleSharecast / Kiều Trường via Pixabay

Apple Inc.

$222.01

13:04 04/11/24

-0.40%

-$0.90

US stocks closed lower on Tuesday, with Apple in focus on the announcement of its iPhone 15, while investors also closed their wallets ahead of August’s consumer price index data, scheduled for Wednesday.

Dow Jones I.A.

41,794.60

04:30 15/10/20

n/a

Nasdaq 100

19,963.60

12:15 04/11/24

-0.35%

-69.54

Tesla Motors Inc

$242.84

13:09 04/11/24

-2.47%

-$6.14

WESTROCK

$51.51

11:00 14/10/24

0.00%

$0.00

At the close, the Dow Jones Industrial Average was down 0.05% at 34,645.99, while the S&P 500 faced a sharper decline of 0.57%, ending the day at 4,461.90.

The tech-heavy Nasdaq Composite was the most affected, shedding 1.04% to close at 13,773.61.

In currency trading, the dollar was last down 0.01% on sterling at 80.05p, while it decreased 0.01% as well against the common currency, trading at 92.98 euro cents.

The greenback meanwhile remained stable on the yen, last changing hands at JPY 147.08.

“Stock indices gave back some of Monday's gains as the tech sector slid,” said IG senior market analyst Axel Rudolph earlier.

“Oracle shares led the way down with an almost 12% drop as the company saw its revenue below estimates as cloud spending sputters.

“WestRock added about 6% after agreeing to merge with Smurfit Kappa to create the world's largest listed paper and packaging company.”

Small business sentiment dips; inflation projections in focus

On the economic front, the National Federation of Independent Business (NFIB) unveiled its latest findings on small business sentiment for August, revealing a slight decline.

The NFIB's index recorded a dip to 91.3, down from 91.9 in July, slightly missing the anticipated consensus of 91.5.

“The details of the August NFIB survey suggest the economy is continuing to expand at a gradual pace, though the rebound in selling price intentions points to inflation rebounding back to 4% over the coming months,” said analysts at Oxford Economics.

“That shouldn't worry the Fed unduly, with the labour market details still pointing to a gradual easing in wage and underlying price inflation ahead.”

All eyes were now on the forthcoming US consumer price index data, scheduled for release on Wednesday.

Early projections hinted at a 0.5% rise in prices for August, marking an uptick from the 0.2% gain observed in July.

However, core inflation looked set to remain steady, with experts forecasting it to maintain its July rate of 0.2% month-on-month.

The economic advisory committee of the American Bankers Association said the Fed had likely concluded its rate-rising cycle.

Additionally, they predicted a deceleration in GDP growth for the coming year, expecting it to cool down to 1.2% from the 2% observed in 2023.

“Shifting rate expectations over recent weeks have added greater uncertainty for markets, and this rumour of an impending pause does help lift sentiment as market pricing adjusts accordingly,” noted Joshua Mahony at Scope Markets.

Apple and Tesla dip, WestRock rises on merger news

In equities, tech giant Apple declined 1.71% as it unveiled an array of new products during its annual marketing event.

Among those were the iPhone 15, the latest Apple Watch, and new versions of its AirPods earphones.

In a significant pricing move, Apple announced an increase in the price of its premium iPhone, which could raise the average spend on an Apple smartphone beyond the $1,000 mark.

The starting price for the new iPhone Pro Max was set to jump by $100, reaching $1,199.

Tesla meanwhile saw a 2.23% drop in its shares, in the wake of a 10% spike the previous day, which was fuelled by Morgan Stanley's upgrade to 'overweight'.

The financial institution emphasised the potential of Tesla's Dojo, a custom supercomputing product that's been under development for half a decade.

Morgan Stanley predicted that Dojo could add as much as $500bn to Tesla's enterprise value, and subsequently increased its stock target price from $250 to $400.

Tech investors in general looked to be exercising some caution on Tuesday, in light of Arm's impending high-profile listing on the NYSE.

The UK chip group's IPO, valued at over $50bn, was reported to be 10 times oversubscribed.

On the upside, WestRock was boosted 2.76% on news of its planned merger with paper and packaging peer Smurfit Kappa.

The merger was set to establish an entity boasting combined revenues amounting to $34bn, and a commanding 20% market share across Europe and North America.

Reporting by Josh White for Sharecast.com.

Dow Jones - Risers

Goldman Sachs Group Inc. (GS) $330.90 1.93%
Chevron Corp. (CVX) $166.81 1.86%
Walt Disney Co. (DIS) $83.68 1.41%
Walgreens Boots Alliance, Inc. (WBA) $21.72 1.35%
JP Morgan Chase & Co. (JPM) $146.34 1.30%
Travelers Company Inc. (TRV) $162.77 1.02%
Intel Corp. (INTC) $38.86 0.70%
Johnson & Johnson (JNJ) $163.58 0.57%
American Express Co. (AXP) $158.50 0.42%
Merck & Co. Inc. (MRK) $109.02 0.39%