Fundamental Analysis

Wall Street Slips On Losses In Apple, Energy Shares

Wall Street edged lower on Thursday in choppy trading as losses in Apple Inc and energy companies dampened the bullish resolve of the major indexes that had rallied in the previous session to its best in a week.

Apple (AAPL.O) weighed the most on the S&P 500 and the Nasdaq, shedding 0.4%, a day after surging 3.8%, while the energy sector (.SPNY) fell 1.6%, tracking lower oil prices on fears of a slowdown in demand.

“It is really just a reflection of the strong gains that we had yesterday and so the market is digesting that,” said Robert Pavlik, senior portfolio manager at Dakota Wealth Management.

After a dull start to August, the markets had roared back to life on Wednesday on a boost from a slew of strong results from companies including PayPal Inc (PYPL.O) and CVS Health .

The benchmark index (.SPX) has gained nearly 13.8% from its mid-June lows, but is still in a bear market and down 13% for the year.

The second-quarter earnings season has helped markets bounce back from concerns around the fallout of the Ukraine war, soaring inflation, flare-up in China COVID-19 cases and an aggressive rise in borrowing costs.

While an unexpected rebound in July services activity allayed recessions fears, market participants are now keeping a close eye on data related to the labor market.

The July employment report, due on Friday, is expected to show nonfarm payrolls likely increased by 250,000 jobs in last month after rising by 372,000 in June. The data is crucial as the U.S. Federal Reserve attempts to cool labor demand to tame inflation.

“Investors are aware that we are in a soft landing for the economy… what will shake up the market is if we end up seeing substantial cuts in growth expectations, meaning if we end up with a lot of companies that are actually just getting rid of employees that could be a problem,” Sam Stovall, Chief Investment Strategist at CFRA said.

A media report overnight said Walmart Inc (WMT.N) was cutting hundreds of corporate roles in a restructuring effort.

At 10:20 a.m. ET, the Dow Jones Industrial Average (.DJI) was down 97.65 points, or 0.30%, at 32,714.85, the S&P 500 (.SPX) was down 8.51 points, or 0.20%, at 4,146.66, and the Nasdaq Composite (.IXIC) was down 8.23 points, or 0.06%, at 12,659.93.

Tesla Inc (TSLA.O) rose 0.7% ahead of an investor vote on a variety of matters including a three-for-one stock split that would make the company’s shares more accessible.

Health insurer Cigna Corp (CI.N) gained 3.7% after raising its annual profit forecast.

Drugmaker Eli Lilly and Co (LLY.N) slipped 2.9% as its cut annual profit view for the second time.

Declining issues outnumbered advancers for a 1.02-to-1 ratio on the NYSE. Advancing issues outnumbered decliners by a 1.24-to-1 ratio on the Nasdaq.

The S&P index recorded one new 52-week highs and 29 new lows, while the Nasdaq recorded 28 new highs and 14 new lows.

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Vladimir Ribakov

Following 11+ years of trading experience, trading my own accounts as well as for hedge funds and brokerages, I have decided to fulfill my destiny and to personally mentor Forex and Commodities traders. When I released the “Broker Nightmare” (software that hides trades from brokers) 8 years ago, I found an overwhelming number of frustrated people who genuinely wanted to learn how to trade the Forex market, but instead found themselves scammed and misled. Over the years I have also release other trading systems based on my trading strategies, and met a lot of people on my worldwide Forex seminars. We’ve formed a close Forex community and we meet once or twice a year in various locations in Europe.

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