While you were sleeping: UPDATED Apple bites into sentiment, oil rises

Wall Street was mixed as a slide in Apple shares amid concern that the company is preparing for slower sales of its iconic iPhone offset gains in Nike and Microsoft.

Energy shares also rebounded along with oil prices. US crude futures ended up 1% to settle at a new six-month high of $US46.70 a barrel.

At the close, the Dow Jones Industrial Average was up 9.38 points, or less than 0.1%, to 17,720.50. The Nasdaq Composite Index fell 0.5% to 4737.33 while the Standard & Poor's 500 Index was essentyially flat at 2064.11.

The Dow advanced as gains in shares of Nike and those of Microsoft, up 1.7% and 1.2% respectively, outweighed slides in shares of Apple and those of General Electric, down 2.4% and 0.7% respectively.

Shares of Apple dropped to their lowest level in two years amid concern about the appeal of its latest iPhone, expected to be launched later this year.

"People are getting negative data points about component orders and production forecasts, and the features on the new iPhone do not seem to be a big change from the 6S," Rosenblatt Securities analyst Jun Zhang told Reuters.

Retailer Kohl’s Corporation fell 9.2%, after it reported a 87% drop in profit in the latest quarter as sales unexpectedly fell.

US jobless claims rise
While a Labor Department report showed that initial jobless claims unexpectedly rose last week, increasing by 20,000 to 294,000, analysts said it was not a sign of a weakening jobs market.

"We have to look past the noise in the latest jobless claims number because it was likely influenced by the Verizon strike," Jacob Oubina, senior US economist at RBC Capital Markets in New York, told Reuters. "The broader underlying trend in claims remains very constructive."

Indeed, while a majority of economists in a Reuters survey said they expect the Federal Reserve to wait until September before raising interest rates again, almost a third of more than those 90 economists in the poll still expect the Fed will hike its federal funds rate to 0.50-0.75% in June.

"It is not that a June rate hike is off the table entirely, but again, we would need to see some fairly strong data between now and the June FOMC (Federal Open Market Committee) meeting," Sam Bullard, senior economist at Wells Fargo, told Reuters.

Bayer report boosts Monsanto
Monsanto shares jumped on a Bloomberg report that Bayer is considering a bid for its US rival in a deal that would create the world's largest supplier of seeds and farm chemicals.

The German firm has held preliminary discussions internally and with advisers about buying Monsanto, Bloomberg reported, citing people familiar with the matter.

Bayer has discussed how to finance a deal including potential asset sales, according to Bloomberg, but no final decision has been made. The Leverkusen-based company could decide against a bid or pursue other transactions with Monsanto, including joint ventures or asset sales, the people told Bloomberg.

Monsanto shares traded 8.4% higher at $US97.92 after rising as high as $US100.85 earlier in the session. Shares of Bayer closed 4.3% lower in Frankfurt.

Europe's Stoxx 600 Index finished the day with a 0.5% retreat from the previous close. France's CAC 40 index declined 0.5%, the UK's FTSE 100 index dropped 1%, while Germany's DAX index shed 1.1%.

"A mixed set of results from companies delivered against lowered expectations is not helping the markets," Benno Galliker, a trader at Luzerner Kantonalbank in Lucerne, Switzerland, told Bloomberg. "The real trigger the market needs right now is an improvement in global growth prospects and it doesn't feel like that is happening."

(BusinessDesk)