I'm applying to a grad school in the US for fall 2016. While filling the application, I stated my initial and terminal degree preferences as Master's only (and not PhD) as I want to work in the industry post MS. Will it hurt my chances of getting selected?
Probably not. In fact, each student admitted to a PhD program constitutes a fairly major commitment on the part of the university and department, so admissions standards are generally higher for Ph.D. applicants.
That said, if the program you are applying to doesn't "do" Masters, you won't get in. For your own good, you should be limiting applications to programs that have thriving Master's Programs, because they'll probably be better at providing your education appropriately.
Further, my own opinion is that if you feel pressure from the department you're applying to to accept admission as a Ph.D. student when you've applied as a Master's, beware.