Stocks: Apple's weak outlook trumps hopes about China trade and a strong jobs report
Posted November 2, 2018 9:46 a.m. EDT
(CNN) — Stocks opened Friday mixed as increased hopes for a US-China trade deal and a solid jobs report pushed the Dow higher but weren't enough to offset concerns about a lackluster holiday outlook from Apple.
The Dow was up 130 points, or 0.5% in early trading. The S&P 500 rose about 0.4% as well.
Stocks rallied overseas after Bloomberg reported that President Donald Trump was asking cabinet members to begin drafting a possible trade deal with China.
But CNBC debunked that story, reporting that a White House official said that "there is a long way to go" before any China agreement was reached.
Despite the conflicting reports about US trade talks with China, investors still cheered other news from Washington — the strong October jobs report.
The US economy added 250,000 jobs last month and the unemployment rate held steady at 3.7%, the lowest level in nearly half a century. American workers had more good news too. Wages rose 3.1% from a year ago.
The uptick in wage growth may eventually spark more fears that the Federal Reserve will raise rates more aggressively in order to fight inflation. But investors seemed to be shrugging off those concerns Friday. Bond yields rose only slightly after the jobs report.
In corporate news, the tech-heavy Nasdaq was slightly higher. That was largely due to the fact that Apple (AAPL) — which is also one of the Dow's biggest components — fell 5% following its latest earnings report. Apple issued a somewhat tepid outlook for the next few months.
Chinese e-commerce giant Alibaba (BABA) was up after beating earnings forecasts. The company lowered its outlook for 2019, citing the uncertain state of the global economy.
Still, other blue chip companies reported strong results. Oil giants Exxon Mobil (XOM) and Chevron (CVX) both popped more than 2% after posting solid gains in profit that topped Wall Street's forecasts.
And coffee king Starbucks (SBUX) soared 8% after it reported strong sales and earnings after the market closed Thursday.