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Apple down on report to drop iPhone production boost plans
U.S. 10-yr Treasury yields back off 12-year highs
Biogen soars on landmark Alzheimer's data
Futures down: Dow 0.29%, S&P 0.51%, Nasdaq 1%
Sept 28 (Reuters) - U.S. stock index futures fell on
Wednesday led by Apple after it dropped plans to boost
production of its new iPhones, but a pullback in benchmark
Treasury yields from multi-year highs limited the decline.
Shares of the world's most valuable public company
fell 3.7% in premarket trading after Bloomberg reported Apple
had told suppliers to curtail efforts to increase assembly of
its iPhone 14 product family by as many as 6 million units in
the second half of this year.
"Apple has got so many pieces and any weakness in Apple
demand has big knock-on impacts on many spaces, so chips,
processing and the outlook for retail sales even," said Patrick
Armstrong, chief investment officer at Plurimi Wealth.
The report on Apple's production cut added fuel to investors
worried about the U.S. Federal Reserve's push to aggressively
increase borrowing costs to tame stubbornly high inflation even
at the risk of slowing down economic growth.
Other megacap growth names such as Amazon.com Inc,
Microsoft Corp, Meta Platforms Inc and Tesla
Inc also fell between 0.6% and 2.1%.
Chipmakers Advanced Micro Devices, Qualcomm Inc
Nvidia Corp and Micron Tech were down
between 1.5% and 2.8%.
Still, a bit of relief for equity markets came from a Bank
of England decision to buy as many long-dated government bonds
as needed between now and Oct. 14.
The yield on the U.S. 10-year Treasury bill
came off 12-year highs to hit the day's low of 3.886%, while
Germany's 10-year government bond yield, the
benchmark for the euro zone, fell after touching a 11-year high.
"Yields now are approaching the Fed's desired target level
of 4 and 4.5%. So once that happens, we should see yields
beginning to level off and that should boost equity prices,"
said Peter Cardillo, chief market economist, Spartan Capital
"The market is very, very sold."
At 7:30 a.m. ET, Dow e-minis were down 85 points,
or 0.29%, S&P 500 e-minis were down 18.75 points, or
0.51%, and Nasdaq 100 e-minis were down 113.75 points,
In the previous session, Wall Street's main indexes sank
deeper into a bear market, with the S&P 500 recording its lowest
close in almost two years on rate hike worries.
Bucking the overall slide, Biogen surged 45.9%
after its Alzheimer's drug, developed with Japanese partner
Eisai, succeeded in slowing cognitive decline.
Shares of Eli Lilly & Co, which is also developing
an Alzheimer's drug, rose 7.7%.
(Reporting by Shreyashi Sanyal, Susan Mathew and Ankika Biswas
in Bengaluru; Editing by Vinay Dwivedi and Arun Koyyur)