Thursday Technology Stocks Dropped on Concerns Over the Outlook for Apple

Good morning.

Market futures are trending down this morning after the S&P 500 and Nasdaq closed in the red on Thursday as technology stocks dropped on concerns over the outlook for Apple, while the latest U.S. jobless claims data stoked worries about sticky inflation.

The Labor Department’s report on Thursday showed claims for state unemployment benefits unexpectedly fell -13K to a 7-month low of 216K, stronger than expectations of 234K, which further supports the notion of the Federal Reserve holding rates higher for longer. Also, U.S. unit labor costs were revised higher to +2.2% q/q from +1.6% q/q in the second quarter. In addition, U.S. Q2 nonfarm productivity was revised lower to +3.5% q/q from +3.7% q/q.

Today, markets will likely focus on U.S. Wholesale Inventories data, which stood at -0.5% m/m in June. Economists foresee the July figure to be -0.1% m/m. On the radar is Consumer Price Index for August due on Sept. 13, which will be followed by the Federal Reserve’s policy decision on Sept. 20.

Shares of Apple were flat in premarket trading after a two-day selloff that weighed on U.S. stocks following news that Beijing has ordered central government employees in recent weeks to stop using iPhones at work. Another report on Friday said China’s restrictions are expanding to local governments and state-owned companies.

Current funding for most government programs expires on Sept. 30. If lawmakers are unable to pass a new budget by then, large swathes of government functions would shut down, an event strategist at Goldman Sachs estimate would reduce U.S. economic growth by 0.2% for each week it lasted.

WTI crude futures hovered around $87.50 per barrel. Gold steadied above $1,920 an ounce while the yield on the US 10-year Treasury note steadied at 4.25%.

Have a great weekend.