Marketmind: Apple and dollar roil markets

The German share price index DAX graph is pictured at the stock exchange in Frankfurt

A look at the day ahead in European and global markets from Ankur Banerjee

Investors probably can’t wait for the week to end, with worries over China’s curbs on iPhones and the dollar’s resurgence in the past few weeks casting a long shadow over the markets.

Apple has seen about $200 billion (that’s eleven zeros in total) wiped from its market capitalisation in two days on reports of China curbing iPhone use by state employees.

The broader U.S. tech sector also took a hit, while shares of several major Apple suppliers in Asia slid on Friday. Nearly a fifth of Apple’s revenue is generated in China, where thousands of workers are employed by the company and its suppliers.

It all comes ahead of an Apple event next week where the $2.78 trillion company is expected to unveil its iPhone 15 line-up, as well as new smartwatches.

Meanwhile, China’s Huawei Technologies on Friday started presales for its Mate 60 Pro+ smartphone, adding a new version to a series that has captured global attention for revealing the Chinese tech firm’s success in beating back against U.S. sanctions.

Richly valued tech stocks have also felt the weight of rising U.S. yields as traders bet that elevated interest rates are here to stay for a while longer.

That has resulted in the dollar’s rampaging run in the past few weeks. Against a basket of currencies, the dollar is set to clock an eighth straight week of gains. The last time it had a similar run was in 2014.[FRX/]

A Reuters poll of forex strategists suggests that the dollar’s strength will be difficult to overcome for most major currencies by the end of the year.

Demand for the U.S. currency has made life difficult for most other currencies, with the onshore yuan breaching a 16-year low and the yen straddling the weaker side of the psychologically important 145 per dollar line, keeping traders alert for possible intervention.

And so with Europe waking up, investors are likely to have a volatile end to the week, with futures indicating a mixed open.

The pan-European STOXX 600 index has fallen for seven straight days, its worst string of losses since February 2018.

Investor focus will also be on debt-ridden French supermarket retailer Casino after the markets operator Euronext said the retailer will be excluded from Paris’ SBF-120 equity index of major companies.

Key developments that could influence markets on Friday:

Economic events: Germany’s inflation data for August

(Reporting by Ankur Banerjee; Editing by Kim Coghill)