Stocks fell sharply lower on Monday, reversing early session gains, following news that Apple (NASDAQ: AAPL) plans to slow hiring and cut spending next year to prepare for a possible economic slowdown. The Dow Jones Industrial Average fell over 200 points, while both the S&P 500 and Nasdaq Composite slipped over 0.8%.
On Monday, Bloomberg News reported that Apple plans to cut down on spending and hiring across certain divisions in 2023 to "be more careful during uncertain times," according to people familiar with the matter. Shares of Apple closed down 2.1%.
Here's how the market settled on Monday:
S&P 500 Index (NYSE: SPY): -0.84% or -32.31 points to 3,830.85
Dow Jones Industrial Average (NYSE: DIA): -0.69% or -215.65 points to 31,072.61
Nasdaq Composite Index (NASDAQ: QQQ): -0.81% or -92.37 points to 11,360.05
Monday's moves follow a rally on Friday that saw stocks close sharply higher, but all three major indexes ultimately closed out the week lower after June's red-hot Consumer Price Index (CPI) data shocked Wall Street.
Before Bloomberg's report, investors were encouraged by better-than-expected earnings reports from Bank of America (NYSE: BAC) and Goldman Sachs (NYSE: GS) issued before the bell. These big bank earnings followed a second-quarter beat from Citigroup (NYSE: C) and disappointing finicals from JPMorgan Chase (NYSE: JPM) and Morgan Stanley (NYSE: MS).
Elsewhere, the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index showed home building sentiment fell 12 points to a reading of 55 in July, marking the lowest level since the start of the pandemic.
While any rating above 50 on the index is considered positive, sentiment has fallen 24 point since March as mortgage rates continue to rise higher. Currently, the average rate of a 30-year fixed mortgage is now nearly 6%, which is nearly double rates from January.
"Affordability is the greatest challenge facing the housing market," said robert Dietz, NAHB's chief economist, in a press statement. "Significant segments of the home buying population are priced out of the market."
Over 70 companies are set to release earnings results in the week ahead as the second quarter earnings season starts to heat up. Notable upcoming reports include Netflix (NASDAQ: NFLX), Tesla (NASDAQ: TSLA), United Airlines (NASDAQ: UAL), Johnson & Johnson (NYSE: JNJ), and Twitter (NYSE: TWTR).