Apple fails
Wall Street heads into the weekend with losses
08/04/2023, 11:11 p.m
The US job market report is mixed and causes a small roller coaster ride on the US stock exchanges. The Dow ends trading with slight losses. Amazon can inspire investors with strong numbers, but they prefer to keep their hands off Apple.
Burdened by price losses at Apple, the US stock exchanges closed weaker on Friday after a mostly friendly performance. Investors sold their shares in late trading as they feared further negative surprises from forthcoming company balance sheets. Since the US labor market data did not deliver the hoped-for clear monetary policy signals, investors also shied away from buying. On the other hand, easing concerns about further interest rate hikes and encouraging quarterly figures from Amazon prevented larger price losses.
The US Standard Value Index Dow Jones closed 0.4 percent lower at 35,065 points. The tech-heavy one Nasdaq also fell 0.4 percent to 13,909 points. The broad one S&P 500 lost 0.5 percent to 4478 jobs. For this trading week, this results in a minus of around one percent for the Dow, around two percent for the S&P and almost three percent for the Nasdaq.
Outside US agriculture, 187,000 new jobs were created in July. Analysts had expected 200,000. “This provides further evidence that the labor market is finally starting to weaken,” said Stuart Cole, chief economist at brokerage firm Equiti Capital. However, the inflationary pressure remains high because of the surprisingly significant increase in wages. This gives supporters of a tighter monetary policy arguments for another interest rate hike in September.
Forex and bond investors, however, were undeterred. They are betting that the Fed’s rate hike cycle is over. The dollar index, which reflects the exchange rate for important currencies, turned negative after the numbers and lost 0.4 percent to 102.03 points. At the same time, investors grabbed more again US Bonds. This pushed the yield on two-year bonds, which usually react particularly sensitively to changes in interest rate expectations, to 4.768 percent. The leadership of the US Federal Reserve was also divided on how to proceed. While Atlanta Fed District Chief Raphael Bostic saw no need for more interest rates after the jobs data, his Chicago counterpart Austan Goolsbee warned against prematurely declaring victory over inflation.
The individual values increased Amazon by around eight percent. The online retailer’s quarterly results exceeded expectations in all areas, praised analyst John Blackledge from asset manager Cowen. Investors reacted particularly positively to the surprisingly robust business of the cloud subsidiary AWS. This gave their competitors a boost. The titles of snowflakes increased by 3.5 percent.
Apple on the other hand, fell through with investors despite a surprisingly high quarterly turnover. The weakening sales of the core product iPhone spoiled their mood. It overshadowed strong performances from the services division. “Apple needs to restart hardware sales growth,” said analyst Dan Coatsworth of brokerage house AJ Bell. Otherwise there would be doubts that a new generation of customers would join the electronics group’s ecosystem. Apple shares lost almost five percent.
Nikola fell more than 26 percent. The troubled supplier of electric trucks is looking for a new boss for the fourth time in four years. The company also announced a quarterly loss of nearly $218 million.