Nasdaq dragged lower as Apple’s 2-day valuation wipeout nears $200bn

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A drop in Apple’s shares pulled US stock indices lower on Thursday, as news that China would broaden a ban on the use of iPhones helped push the tech giant’s market capitalisation wipeout over the past two sessions to nearly $200bn.

Wall Street’s benchmark S&P 500 fell 0.3 per cent and the technology-focused Nasdaq Composite declined 0.9 per cent, extending losses from the previous trading session.

Apple shares closed 2.9 per cent lower on Thursday, pushing their decline since Tuesday’s closing bell to 6.4 per cent in one of their steepest two-day sell-offs this year.

The company carries the biggest index weighting in the S&P 500 and the Nasdaq Composite. The drop in Apple’s stock comes after The Wall Street Journal on Wednesday reported that Chinese government officials had been ordered to not use iPhones for work.

Broader concerns over the outlook for the Chinese economy have been a recurring theme this week. Data from Beijing on Thursday showed Chinese exports fell 8.8 per cent year on year in August, while imports declined 7.3 per cent in a sign that demand was slowing domestically and abroad.

China’s CSI 300 fell 1.4 per cent and Hong Kong’s Hang Seng lost 1.3 per cent.

Oil prices edged lower, as worries about slowing demand in China — the world’s top importer of the fossil fuel — overshadowed an earlier announcement of supply cuts by Saudi Arabia and Russia.

Brent crude, the international marker, settled 0.8 per cent lower to trade at $89.92 a barrel, although it remains near its highest level this year, while the US equivalent West Texas Intermediate dropped 0.8 per cent to $86.86 a barrel.

In Europe the region-wide Stoxx Europe 600 ended the day 0.1 per cent lower, marking its seventh successive day of losses. Germany’s Dax also declined 0.1 per cent.

In Europe, the Stoxx Consumer Products and Services index closed 0.7 per cent lower at its lowest level since the start of this year, as investors worried that an economic slowdown in China could lower demand for the region’s exports.

In the US market, investors also weighed data from the US labour department showing that jobless claims decreased more than expected to 216,000 in the week ending September 2, their lowest level since February.

The data added to numerous recent signs that the US economy remains resilient despite the Federal Reserve having raised interest rates to a 22-year high. That suggests a “soft landing” for the domestic economy remains on the cards, which could mean monetary policy may not be loosened soon.

“Higher for longer [on interest rates] is not what investors want to hear, but this message hampered global markets this week as economic data made for uncomfortable reading,” said Lewis Grant, senior portfolio manager for global equities at Federated Hermes.

Yields on US Treasuries, which move in the opposite direction to price, slid despite the strong jobless claim figures. The yield on the policy-sensitive two-year note fell 0.08 percentage points to 4.94 per cent. The dollar rose 0.2 per cent against a basket of six currencies on Thursday, hitting its highest level since March.