Nasdaq drops as weekly jobless claims disappoint

The Nasdaq Composite fell for a fourth session Thursday as concerns resurfaced over the Federal Reserve’s interest rate policy path, as the latest jobless claims data has come in.

The tech-heavy Nasdaq sold off 0.89 per cent to end at 13,748.83, while the S&P 500 slipped 0.32 per cent to finish at 4,451.14. The Dow Jones Industrial Average added 57.54 points, or 0.17 per cent, to settle at 34,500.73.

Apple shares dropped 2.9 per cent on a Bloomberg News report that China is looking to broaden a ban on the use of iPhones in state-owned companies and agencies.

Technology and semiconductor stocks lagged, with Nvidia and Advanced Micro Devices falling 1.7 per cent and 2.5 per cent each.

Seagate Technology shed nearly 11 per cent, while Skyworks Solutions, Qualcomm and Qorvo edged down at least 7 per cent.

A series of economic data points Thursday — including fewer-than-expected jobless claims — contributed to fears that the still-strong labour market may make the Federal Reserve think twice about relaxing its tight monetary policy stance.

Weekly jobless claims came in at 216,000, versus the 230,000 expected by Dow Jones, while second-quarter labour costs rose more than anticipated.

Combined with the recent uptick in energy prices, a strong jobs market will boost the need for the Fed to act and potentially approve more hikes.

While 93 per cent of traders pricing in a rate pause at September’s Federal Open Market Committee meeting, future hikes aren’t off the table. Expectations for an additional increase in November have risen to roughly 43 per cent, according to the CME Fed Watch tool.

Traders also combed through the latest corporate earnings reports. C3.ai slid 12.2 per cent on weak guidance, while ChargePoint plunged 10.9 per cent after missing revenue estimates.

In commodity news, the negotiations between Chevron and the unions regarding LNG (liquefied natural gas) have extended into Friday. Originally, strikes were anticipated earlier in the week but were postponed until 1pm Perth time on Friday as discussions between the two parties persist. The outcome of a deal remains uncertain, according to the unions.

RBC Capital forecasts that US oil prices will average $86.50 per barrel, and Brent prices will average $91.00 per barrel in the final quarter of this year. They believe the market is currently in a healthy state but caution that it's already priced optimistically, with limited visible catalysts for significant upside.

Turning to US sectors, Tech was the worst performer of the bunch. Utilities was the best perform.

Futures

The SPI futures are pointing to a 0.1 per cent rise.

Currency

One Australian dollar at 7:30 AM was buying 63.76 US cents.

Commodities

Gold lost 0.09 per cent. Silver dropped 1.12 per cent. Copper fell 0.63 per cent. Oil dipped 0.77 per cent.

Figures around the globe

European markets closed mixed. London’s FTSE added 0.21 per cent, Frankfurt slipped 0.14 per cent, and Paris closed 0.03 per cent higher.

Turning to Asian markets, Tokyo’s Nikkei fell 0.75 per cent, Hong Kong’s Hang Seng lost 1.34 per cent while China’s Shanghai Composite closed 1.13 per cent lower.

The Australian sharemarket closed 1.19 per cent lower at 7,171.

Ex-dividends

Argo Global Ltd (ASX:ALI) is paying 4.5 cents fully franked
Base Res Limited (ASX:BSE) is paying 4 cents unfranked
Generation Dev Group (ASX:GDG) is paying 1 cent fully franked
Mineral Resources (ASX:MIN) is paying 70 cents fully franked
Nine Entertainment (ASX:NEC) is paying 5 cents fully franked
Objective Corp (ASX:OCL) is paying 13.5 cents unfranked
Peet Limited (ASX:PPC) is paying 4 cents fully franked
Wisetech Global Ltd (ASX:WTC) is paying 8.4 cents fully franked

Dividends payable

JB Hi Fi Ltd (ASX:JBH)
Probiotec Ltd (ASX:PBP)
Baby Bunting Group Ltd (ASX:BBN)

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.

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