Wall Street Turns Negative as Apple Drops; Dow Down 185 Pts

By Geoffrey Smith 

Investing.com -- U.S. stock markets turned negative at midday, after opening strongly on Thursday, shrugging another set of weekly jobless claims numbers that suggested the labor market recovery is stalling.

By 12:47 PM ET (1647 GMT), the Dow Jones Industrial Average was down 185 points or 0.66% while the S&P 500 was 0.58%. The Nasdaq Composite, which has seen the greatest volatility over the last week as a skewed options market has rapidly rebalanced, fell 0.32%. Apple Inc (NASDAQ:AAPL) shares were down 0.98%.

Earlier, figures released by the Department of Labor showed that initial jobless claims stuck at 884,000 last week, unchanged from the previous week and above consensus forecasts. The total number of people claiming jobless benefits as of the week through August 22 rose by nearly 400,000 to 29.61 million.

However, economists still believe that the economy is recovering more strongly than they initially expected: a monthly Wall Street Journal survey of analysts suggested third-quarter gross domestic product will grow by 23.9% on an annualized basis, up from a consensus of 18.3% a month earlier.

Earlier in the session, Tesla (NASDAQ:TSLA) stock continued the recovery from its 21% decline on Tuesday, rising another 4.0%. By contrast, shares in Nikola (NASDAQ:NKLA), the aspiring electric truck-maker, fell 8.0% after short-seller Hindenburg Research published a short report on the stock, in which it called the company "an intricate fraud built on dozens of lies."

Nikola, which sold an 11% stake in itself to GM for $2 billion earlier in the week, didn't immediately post a response to the allegations on its website.

Shares in conventional truck-maker Navistar (NYSE:NAV) rose 16.6% after Volkswagen (DE:VOWG_p) truck unit Traton (DE:8TRA) raised its offer for the company to $43 a share.

Elsewhere, Citigroup (NYSE:C) stock rose 1.8% - without threatening to break out of a narrow range it has been in since June - after the bank announced that Jane Fraser will succeed CEO Michael Corbat when he retires in February. Fraser, who has been Citi's president and head of its consumer bank for the last year, is the first woman to take control of a major Wall Street institution.

Mall owners Simon Property Group (NYSE:SPG) and Brookfield Property Partners (NASDAQ:BPY) were down 0.6% and up 1.5% respectively after agreeing to buy most of the assets of bankrupt department store JC Penney (OTC:JCPNQ), whose stock rose 27% in over-the-counter trading.

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