Here Are 3 Hot Things to Know About Stocks Right Now
- The Dow Jones Industrial Average finished up Tuesday and tech stocks fell as Apple (AAPL - Get Report) unveiled its iPhone 11 and announced that its Apple TV+ streaming service will launch at $4.99 per month.
- Apple made the announcements at its "By Innovation Only" event at its campus in Cupertino, California. Apple is Real Money's Stock of the Day.
- Ford (F - Get Report) shares fell after analysts at Moody's Investors Service cut the automaker's credit rating to junk status.
Wall Street Overview
Apple is Real Money's Stock of the Day. Shares were up 1.2% to $216.70.
"Apple announced the same incremental updates it does every year: better camera, better processor, more RAM," said Gorilla Trades strategist Ken Berman. "The new naming convention (iPhone 11 Pro), however, is interesting, possibly to show how powerful the iPhone truly is when it comes to video. Apple TV+ is another subscription service that can explode for Apple. At a much better entry price point than their competitors, and the significant investment it is putting into this division, it's bound to do well."
As far as tech stocks slipping, Berman said ""there is a rotation away from strongest momentum stocks the past few sessions. However, I think it will be short-lived."
In trade news, China posted the steepest decline in factory gate inflation in at least three years in August, suggesting manufacturers are having to slash prices in order to win new orders and offset the impact of tariffs on goods exported to the United States. New car sales in China, the world's biggest automobile market, also declined, falling 9.9% from last year and notching the 14th drop in the past 15 months.
U.S. Treasury Secretary Steve Mnuchin said that there is a "conceptual agreement" around intellectual property theft with China.
The data from China suggested a weakening economy that has yet to find support from various government stimuli, including bank liquidity support and tax cuts.
The results also put added pressure on Beijing to move more quickly to solve its trade dispute with Washington, a view Mnuchin shared during an interview with Fox Business.
In addition, Huawei dropped one of its lawsuits against the U.S., CNBC reported, after equipment seized by Washington nearly two years ago was returned to the company, a sign that perhaps tensions between the world's two biggest economies may be easing ahead of a meeting slated for Oct. 1.
Economists expect the Federal Reserve to cut interest rates when it meets next week, while the European Central Bank is expected to reveal a major stimulus effort on Thursday.
In addition, the number of job openings declined by 31,000 to 7.22 million in July from 7.25 million the previous month, the U.S. Bureau of Labor Statistics said in its JOLTS, or Job Openings and Labor Turnover Survey. Economists had forecast job openings would increase to 7.48 million.
"Trade and global growth concerns strike again," said Mike Loewengart, vice president of investment strategy at E*Trade. "And in the current rate environment interest has been waning in growth-oriented sectors like tech, and building in value-oriented sectors like energy and financials."
Loewengart added that "the markets could also be reading into today's softer than expected JOLTs data. What's concerning is JOLTs have been on the downtrend for the past three months now and seeing today's data reinforcing this trend is another signal of a slowing economy."
Ford (F - Get Report) shares fell 1.4% to $9.41 after analysts at Moody's Investors Service cut its credit rating to junk status, citing "considerable operating and market challenges" amid the carmaker's multi-billion restructuring plans.Shares of fast-food restaurant chain Wendy's ( WEN - Get Report) fell 10.2% to $19.71 after the company lowered its 2019 financial outlook amid plans to invest about $20 million to retrofit and support its U.S. stores and franchisees.
Shares of Mallinckrodt (MNK - Get Report) jumped 85.2% to $3.89 after the drugmaker said it would sell its contract development and manufacturing subsidiary BioVectra for $250 million to an affiliate of private-equity firm H.I.G. Capital.
Market sentiment also took a hit after President Donald Trump tweeted he'd fired national security adviser John Bolton after the two failed to see eye-to-eye on the big foreign policy challenges facing the nation, including Iran, North Korea and Afghanistan. Bolton tweeted that he had resigned.
Oil prices sank upon news of Bolton's departure. Brent crude contracts were down 12 cents to $62.47 a barrel, while West Texas Intermediate contracts, which are more tightly linked to U.S. gas prices, were 29 cents lower at $57.56 a barrel.