Wall Street Heads for Weekly Losses: Apple’s Rollercoaster, the Fed’s Influence, and Oil’s Resilience
Apple is in the spotlight as the latest pawn in the U.S.-China War. The company wiped away a Total of $200 billion of its market capitalization due to the recent chip breakthrough. Due to concerns over a potential ban on iPhone use by Chinese government workers and increased domestic competition. The company took serious losses this week, yet in today’s lesson, the company managed to get back on track. The company’s share price rose by 0.34% this morning. Overall, all Wall Street mains opened higher this trading session, yet in terms of weekly gains, Wall Street will end this week’s session low. The S&P 500 benchmark rose by 0.35% to 4,446 bps, and the tech-heavy Nasdaq was up by 0.47% to 13.812 bps. As for the Dow Jones, the index has performed well this week, posting another increase of 0.29% to 34.600 bps.
As for the subject of the U.S.-Chinese War, Beijing’s announcement is believed to be a retaliatory move by China over the U.S. restrictions on Chinese-made products, such as TikTok and Huawei. Given the forthcoming launch of the iPhone 15, there are some concerns regarding the impact of the ban. However, Wedbush analysts believe these fears are overblown and that they will not have a significant impact on Apple’s sales. Furthermore, analysts from Bank of America and SA suggest that Apple could face stiff competition from Huawei’s latest flagship smartphone in the region, potentially further dampening sales.
As for the Wall Street stock market, investors’ confidence in the FED’s monetary policy increased significantly last week. The recent string of economic data will likely encourage the central bank to keep up with the current interest rate hikes. As inflation remains above the target rate of 2%, the U.S. Federal Reserve’s reserve task is not yet done.
Strong economic data, including lower-than-expected initial jobless claims, raises concerns about prolonged elevated interest rates by the Fed. This in turn will impact tech stocks and increase market volatility, causing a 2% decline in the Nasdaq index. Despite the gloomy outlook, the Fed is expected to keep rates steady in the upcoming meeting, but the resilient economy suggests future rate hikes are possible. According to Dallas Federal Reserve Bank President Lorie Logan, there is still work to be done, though forecasts are uncertain. That said, the chances of raising key interest rates at the November meeting are currently above 40%.
In other economic news, the U.S. dollar fell by 0.08% to its level of 104. Falling from a six-month high. As for the oil industry, oil prices rose again today after declining on Thursday’s trading day. Main benchmarks are set to gain around 2% for the week due to Saudi Arabia and Russia extending supply cuts. Saapkaing about the IL industry data Late Thursday data revealed a significant 6.3 million barrel reduction in U.S. inventories for the week ending September 1, marking the fourth consecutive weekly decrease.