The markets are all down today, however, off the lows and a tiny pullback compared to 30 years ago when the market dropped 580 points. Today, a similar drop would be 5000 points.  So, we can take the Dow off 23 points, especially after breaking through 23,000 yesterday. 

The market is being pressured in part by Apple as lower demand concerns for the iPhone 8 and iPhone 8 Plus mount after reports that the company has reduced its supplier’s orders.  This is after the WSJ reported that the new Apple Watch cellular feature was cut off in China.  Apple is currently trading down around 2.8% and taking its supply chain with it.

On the economic front, initial claims for the week ending October 14 declined by 22,000 to 222,000.  This marks the lowest level since March 31, 1973.  A better gauge, the four week moving average declined by 9,500 to 248,250. 

On the manufacturing front, the Philly Fed Index for October increased to 27.9 from 23.8.  Economist had anticipated a reading of 20. The increase was attributed to gains in the labor market indicators as the current employment index jumped 24 points to an all-time high reading of 30.6.

Highlights from the report include:

• The New Orders Index dropped to 19.6 from 29.5
• The Shipments Index fell to 24.4 from 37.8 to 24.4
• The Unfilled Orders Index declined to 10.9 from 17.0
• The Prices Paid Index increased to 38.1 from 34.4
• The Average Employee Workweek rose to 19.4 from 11.9

The last piece of economic news was the decrease in the Conference Board Leading Economic Index which declined 0.2% in September from the prior month’s unrevised reading of +0.4%.  Economist had forecasted an increase of 0.1%.  The decline this month was the first in over a year, however, much is attributed to the recent hurricanes.

• The ISM New Orders Index added 0.19 percentage points while the interest rate spread added another 0.12 percentage points, helping to offset the negative contributions from other components
• The Coincident Economic Index increased 0.1%
• The Lagging Economic Index decreased 0.1%
• Initial claims, building permits, and the average workweek took 0.5 percentage points off the index
• The leading economic index climbed 1.7% for the six-month period ending September 2017, but was lower than the 2.2% growth the in prior six months

Decliners led advancers at midday 1649 to 1204 on the NYSE and 1646 to 1069 on the NASDAQ.  Let’s keep our powder dry this afternoon.