Dow was up 57, decliners over advancers about 2-1 & NAZ continued weak, losing another 123. The MLP index added 1+ to the 239s & the REIT index edged up 2+ to the 364s. Junk bond funds slid a little lower & Treasuries continued higher which reduced yields. Oil finally pulled back, taking it under 87, & gold was even at 1944 (more on both below).
AMJ (Alerian MLP Index tracking fund)
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![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
Apple (AAPL) shares, a Dow & NAZ stock, fell following a 4% decline yesterday, after several reports suggesting that Chinese gov
workers could be banned from using AAPL iPhones. The reported
restrictions, which have not been publicly announced by the Chinese
gov, raise concerns that its products could get caught up in
intl tensions between the US & China. Greater
China, including Hong Kong & Taiwan, is its 3rd-largest market,
accounting for 18% of $394B revenue in 2022. It's also
where the vast majority of AAPL products are assembled. China has ordered officials at central gov agencies not to bring iPhones into the office or use them for work, although it was unclear how widely the bans were issued. The ban could spread to other state companies & gov-backed
agencies. While
a ban on all gov employees could reduce iPhone unit sales in
China by as much as 5%, Bernstein analyst Toni Sacconaghi wrote, it would be a larger threat to AAPL if the bans sent a
signal that everyday Chinese citizens should instead use electronics
from Chinese companies. “Perhaps more importantly, restricted use
of iPhones among government employees could negatively impact sales
among consumers (related family members; general populace) and could be
part of a broader move by the Chinese government to promote usage of
domestic technology,” Sacconaghi added. The stock dropped 5.35 (3%).
If you would like to learn more about AAPL, click on this link:
club.ino.com/trend/analysis/stock/AAPL_aid=CD3289&a_bid=6aeoso5b6f7
Apple shares fall after reports that China banned iPhone use by government employees
As lawmakers on Capitol Hill weigh the possibility of a gov shutdown next month, one prominent senator expressed confidence that a resolution will not get reached. "I think there's a significant chance of a government shutdown. And the reason I think that is I think Joe Biden and Chuck Schumer want a government shutdown," Sen Ted Cruz said. The Senate is back from its summer recess a full week ahead of the House. Senate Majority Leader Chuck Schumer noted that the Senate cleared 12 appropriations bills in committee before the recess. The Senate will advance a few individual appropriations bills in the coming weeks. And House Speaker Kevin McCarthy, will try to advance a fig leaf, interim spending package that appeases the right. The House Freedom Caucus & other conservative members will demand various provisions that either trim spending, address the border or wrestle with potential impeachment. But if the House does not approve the continuing resolution, which Cruz thinks will happen, a gov shutdown is certain. The senator argued that Dems would place the blame on the GOP. "Funding for the federal government expires September 30th. And I would put the odds very high that Joe Biden & Chuck Schumer just say, 'To hell with you, congressional Republicans,’" Cruz said. The current breakdown in the House features 222 Reps to 212 Dems with one vacancy. In other words, Reps can only lose 4 votes from their side & still pass a bill without Dem assistance.
The number of Americans applying for unemployment benefits last week fell to the lowest level in 7 months with the labor market seemingly resistant to the higher interest rates put in to place to cool hiring. Applications for jobless claims fell by 13K to 216K for last week, the Labor Dept reported. That's the lowest level since Feb. Jobless claim applications are seen as representative of the number of layoffs in a given week. The Federal Reserve, well into the 2nd year of its battle against inflation, has raised interest rates 11 times to 5.4%, the highest level in 22 years. The Fed's rate hikes are intended to cool the job market & bring down wages, which many economists believe suppresses price growth. Though some measures of inflation have come down significantly, from as much as 9% down closer to 3%, since the Fed starting raising interest rates, the job market has held up better than many expected. The US economy has been adding an average of about 236K jobs per month this year, down from the pandemic surge of the previous 2 years, but still a strong number. Recent gov data also showed that job openings dropped to 8.8M in Jul, the fewest since Mar 2021 & down from 9.2M in Jun. However, the numbers remain unusually robust considering monthly job openings never topped 8M before 2021. Overall, 1.68M people were collecting unemployment benefits the latest week, about 40K fewer than the previous week. That number hasn't been lower since a stretch in early Jan. The 4-week moving average of claims, which smooths out some of the week-to-week volatility, fell by 8K to 229K.
US applications for unemployment benefits fall to lowest level in 7 months
Gold futures declined to tally a 3rd session loss in a row. The next big event for gold & the $, is US CPI data next week, which could influence the Fed's decision whether to hike rates further or not. Thanks to the resilience of US economy, the market is expecting interest rates to remain at current levels longer than previously expected. This is what has helped to keep the $ underpinned & gold undermined. Dec gold declined $1 to settle at $1942 an ounce.
Gold futures settle lower for a third straight session
US crude futures finish 0.8% lower at $86.87 a barrel, which brings to an end a 9-session streak of gains for WTI that matched the longest winning streak in 13 years. Today's moderate retreat in prices was attributed to profit-taking mostly as investors decided the market had reached overbought territory. Prices have risen in 8 of the past 10 weeks & are 25% higher since early Jul. Continuous production cuts by Saudi Arabia & Russia are more than making up for weak demand in place like the US & Germany, both of which are seeing their energy-intensive manufacturing sectors contract significantly. Brent crude also fell, to about $90, ending a 7-session streak of gains.
Oil Ends Lower On Profit-Taking After 9-Session Rally
Now that traders have returned from long holidays, the stock market is struggling. As shown above, it seems like a lot is not going well, starting with a possible gov shutdown. High inflation is continuing to be a problem for the Fed & high interest rates are beginning to pinch in housing & the auto industry. Stocks continue to face headwinds.Dow Jones Industrials
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