Stocks Fall Before the Open as Inflation and Interest Rate Worries Return

September S&P 500 futures (ESU23) are down -0.17%, and September Nasdaq 100 E-Mini futures (NQU23) are down -0.58% this morning after three major U.S. benchmark indices ended the regular session lower as an unexpected rise in a key U.S. services activity gauge bolstered speculation that the Federal Reserve would have to keep interest rates higher for longer.

In Wednesdays trading session, the benchmark S&P 500 and tech-heavy Nasdaq 100 notched 1-week lows, and the blue-chip Dow posted a 1-1/2 week low. Apple Inc (AAPL) plunged over -3% and was among the top percentage losers on the Nasdaq 100 following a Wall Street Journal report stating that China had instructed government agencies to cease using the tech giants iPhone and other foreign electronic devices at work. Also, Lockheed Martin Corporation (LMT) slid more than -4% after the company cut the delivery outlook for its F-35 jets and delayed deliveries of its updated Technology Refresh 3 jets. In addition, Johnson & Johnson (JNJ) fell over -1% after HSBC initiated coverage of the stock with a Hold rating. On the bullish side, AeroVironment Inc (AVAV) surged more than +20% after the maker of combat drones and other unmanned systems reported upbeat Q1 results and raised its FY24 revenue guidance.