The Dow Jones Industrial Average (DJINDICES:^DJI) was heading lower by early Friday afternoon after a volatile morning. An employment report that showed a slowdown in job gains, and executive orders signed by President Trump related to Chinese mobile apps gave investors a lot to think about. The Dow was down about 0.23% at 1:15 p.m. EDT today.

Dragging it down were tech behemoths Apple (NASDAQ:AAPL) and Microsoft (NASDAQ:MSFT). There wasn't any major news coming out of either company, but valuations have been stretched by rallies this year.

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The jobs report and Chinese app ban

It's clear from the July employment report released by the Labor Department on Friday that the jobs recovery will not be quick. Excluding government employment and temporary 2020 Census hiring, the U.S. added 1.462 million nonfarm payrolls in July. That's down from 4.737 million jobs added in June. Including government and Census hiring, the 1.763 million jobs added were higher than the 1.6 million jobs economists were expecting.

The U.S. lost around 22 million jobs through April due to the pandemic, and it has now regained less than half of that total. With Congress yet to pass a new stimulus measure, weak consumer spending following the expiration of the supplemental federal unemployment benefit at the end of July could drive additional job losses.

In addition to the jobs report, investors had to contend with two executive orders signed by President Trump that will effectively ban Chinese apps WeChat and TikTok in 45 days. The move could inflame tensions with China, which might retaliate against American companies.

Big tech has an off day

Shares of Apple and Microsoft topped the list of the Dow's biggest losers by early Friday afternoon. Both stocks have rallied hard this year; Apple is up about 52%, and Microsoft is up 35%. Those rallies have stretched valuations, raising the risk for investors buying today. Both Apple stock and Microsoft stock were down about 2.4% with a few hours left in the trading day.

Apple now trades for roughly 34 times earnings and over 7 times sales, the highest levels in more than a decade. Microsoft trades at a loftier 37 times earnings and over 11 times sales. The aftermath of the dot-com bubble was the last time Microsoft stock was valued at a double-digit multiple of revenue.

Both companies have been doing well despite the pandemic. Apple reported surprise revenue and earnings growth in its fiscal third quarter, with its iPhone business vastly outperforming expectations. Meanwhile, Microsoft's cloud business continues to grow at a quick pace, and its productivity and collaboration software businesses are doing well with more employees working from home.

With a long and deep recession a possibility in the United States, given that the coronavirus pandemic is not going away anytime soon, it will be tough for either company to live up to its valuation. Apple's growth prospects today are certainly not better than they were 10 years ago, when the iPhone was in its infancy. And Microsoft will be exposed to a slowdown in IT spending driven by business failures and cost-cutting.

Apple and Microsoft stocks have been big winners this year. How long it can last remains to be seen.

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