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U.S Stocks Fall Ahead of Apple's Iphone Event and Amid Inflation Data

September 12, 2023
minute read

In the morning trading session on Tuesday, U.S. equities exhibited a decline, as investors awaited the highly anticipated August inflation data from the consumer-price index scheduled for release on Wednesday. Simultaneously, traders maintained a cautious stance in anticipation of Apple's forthcoming marketing event.

Here is a breakdown of how key stock indexes were performing:

  • The Dow Jones Industrial Average (DJIA) registered a decrease of approximately 51 points, equivalent to a 0.2% decline, hovering around the 34,613 mark.
  • The S&P 500 (SPX) witnessed a decline of 20 points, representing a 0.5% decrease, with its level at 4,467.
  • The Nasdaq Composite (COMP) experienced a drop of 102 points, reflecting a 0.7% contraction, settling at approximately 13,816.

Market Dynamics:The U.S. stock market exhibited a subdued trading environment on Tuesday, characterized by a reluctance among traders to undertake aggressive bullish positions in anticipation of potentially market-moving events scheduled for Tuesday and Wednesday.

Notably, Apple is slated to unveil its latest iPhones on Tuesday afternoon, and this event garnered significant attention. In the late morning trading session, Apple's shares dipped more than 1% as investors eagerly awaited insights into the offerings from the world's largest publicly traded company.

Jim Reid, a strategist at Deutsche Bank, humorously remarked, "Welcome to my annual day of being seduced into buying a new iPhone that I don’t really need but desperately want." He emphasized the significance of Apple's product launch, describing it as a potential macroeconomic influencer.

Most sectors within the S&P 500 index were observing negative performance during Tuesday morning's trading session. Information technology registered the most significant decline, with a drop of around 1.2%, based on FactSet data. It is worth noting that the technology sector holds substantial weight within the S&P 500 index.

Anticipating Inflation Data:Investor attention is prominently directed toward the forthcoming release of the August inflation data, as measured by the consumer-price index (CPI), scheduled for Wednesday morning before the U.S. stock market opens. Tom Essaye, the founder and president of Sevens Report Research, highlighted the pivotal importance of CPI data, stating that it remains the most crucial monthly economic metric. He emphasized that if CPI does not continue to decline, financial markets may have to price in a more hawkish stance from the Federal Reserve, potentially posing headwinds for stocks.

Essaye noted that sensitivity to the upcoming CPI report is particularly high because there have been indications that inflation could be stabilizing or potentially rebounding. A "good" CPI report, according to Essaye, would indicate that core inflation, excluding energy and food prices, rose by 0.2% or less in August. Economists surveyed by the Wall Street Journal had forecasted a 0.2% increase in core CPI for the previous month, along with a year-over-year increase of 4.3%.

Previously, core inflation had registered a 4.7% increase in the 12 months through July, as per the consumer-price index. Essaye noted that a continued decrease in core CPI could help allay concerns regarding inflation resurgence, potentially triggering a notable drop in Treasury yields and a favorable relief rally in stock markets.

Valentyna Semerenko
Eric Ng
John Liu
Editorial Board
Bryan Curtis
Adan Harris
Managing Editor
Cathy Hills
Associate Editor

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