Friday, 20 October, 2017

USA stocks fall as North Korea worries rise

By Marc Jones By Marc Jones
Jo Caldwell | 12 August, 2017, 00:20

USA equities fell on Thursday as tensions between the United States and North Korea persisted.

A statement from the North Korean military called President Donald Trump's warning that the communist nation would face "fire and fury" if it continued its provocations a "load of nonsense".

The VIX, a measure of how much volatility investors expect in stocks, rose 44.4 percent, the biggest increase since May. Even so, the close was the highest in a month.

In more back-and-forth between President Trump and North Korea, Pyongyang General Kim Rak Gyom, leader of the country's strategic forces, said that "sound dialogue is not possible with such a guy bereft of reason and only absolute force can work on [Trump]".

Michael Kors climbed 21.5 percent after the luxury handbag and apparel designer and retailer's latest quarterly results beat analysts' forecasts as sales improved.

"It's incredible when you consider the headlines just how calm the equity markets are, how they've taken things in their stride", said Ryan Detrick, senior market strategist at LPL Financial in Charlotte, North Carolina.

The Dow Jones Industrial Average was 0.93% lower at 21,844.01, the S&P 500 lost 1.45% to 2,438.21, and the Nasdaq 100 was 2.22% softer at 5,788.19.

The Standard & Poor's 500 index fell 0.2 percent, to 2,474.92.

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On the currency markets, the pound was down to a three-week low against the U.S. dollar but mainly due to earlier disappointing output and trade data. "Tensions are still high and not going away at the moment".

"That may have weighed a little bit" on markets, said Phil Guarco, global investment specialist JP Morgan Private Bank.

The South Korean won also faltered 0.9 per cent to its lowest close since July 13, standing at 1,135.2 to the U.S. dollar at the conclusions of onshore trade.

The pan-European STOXX 600 was down 0.7% at closing, France's CAC 40 fell 1.4% after a auto hit a group of soldiers in Paris in what is thought to have been a deliberate act, and a fall in bond yields saw Germany's DAX down 1.1%.

Tokyo's Nikkei 225 tumbled 1.3 percent to 19,737.59 points and Seoul's Kospi fell 0.7 percent to 2,378.56. Pan American Silver Corp, which reported second quarter results, rallied 11.8 percent to C$22.69. The Swiss franc, meanwhile, looked set for its biggest one-day rise in more than two years.

Bond prices rose. The yield on the 10-year Treasury note slipped to 2.25 percent from 2.26 percent late Tuesday. Job openings jumped 8 percent to 6.2 million, the Labor Department said Tuesday.

Meanwhile, traders absorbed a report on jobless claims (http://www.marketwatch.com/story/us-jobless-claims-rise-by-3000-to-244000-2017-08-10) that showed that initial claims for us unemployment-insurance benefits continue to reflect a strong labor market, even as they inched slightly higher.

In commodities, crude oil stretched gains after rising overnight on data pointing to declining USA inventories.

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