Monday, 24 Jun 2024

Wall Street snaps three-day rally as Apple falls, trade hopes fade

(Reuters) – U.S. stocks fell for the first time in four days on Friday after White House economic adviser Larry Kudlow deflated optimism over Sino-U.S. trade talks and as Apple dragged technology stocks lower following a disappointing forecast.

While President Donald Trump would meet China President Xi Jinping later this month, he has not asked U.S. officials to draw up a proposed trade plan, Kudlow told CNBC, contradicting a report earlier in the day that had buoyed hopes of a trade dispute resolution.

The trade-sensitive industrial sector .SPLRCI, which was up as much as 1.13 percent earlier, dropped 0.59 percent to its session low.

Apple Inc (AAPL.O) tumbled 7.3 percent, taking its market value below $1 trillion, after the iPhone maker warned sales for the crucial holiday quarter may miss expectations.

That dragged down shares of its U.S. suppliers, mostly chipmakers, and pushed the S&P technology sector .SPLRCT 2.66 percent lower, putting it on track to snap a three-day rally.

“Investors are looking at risk on, but they are doing it in a cautionary approach. They aren’t rushing back into big FAANG type names,” said Robert Pavlik, chief investment strategist and senior portfolio manager at SlateStone Wealth LLC in New York.

“It’s something to watch, because you need those names to participate in the overall market if it’s going to move much higher as they are big dollar prices.”

At 13:00 ET the Dow Jones Industrial Average .DJI was down 261.57 points, or 1.03 percent, at 25,119.17, the S&P 500 .SPX was down 35.75 points, or 1.30 percent, at 2,704.62 and the Nasdaq Composite .IXIC was down 124.06 points, or 1.67 percent, at 7,310.00.

Economic data was healthy, with the Labor Department’s closely watched report showing job growth rebounded sharply in October, pointing to further labor market tightening that could encourage the Federal Reserve to raise rates in December.

Apple aside, most earnings reports were strong.

Chevron Corp (CVX.N) gained 2.2 percent after reporting its quarterly profit doubled on record oil and gas production.

Starbucks Corp (SBUX.O) jumped as much as 8.5 percent to a record high after the coffee chain reported strong sales in the United States and China.

“You have other areas of the market that are acting well, but not well enough to counterbalance the effects of Apple today,” SlateStone Wealth’s Pavlik said.

Declining issues outnumbered advancers for a 1.84-to-1 ratio on the NYSE and a 1.29-to-1 ratio on the Nasdaq.

The S&P index recorded eight new 52-week highs and four new lows, while the Nasdaq recorded 37 new highs and 34 new lows.

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