Markets Right Now: US stocks trade lower at midday

Xavier Trudeau
Août 12, 2017

The losses have been triggered by a standoff between Washington and Pyongyang, as the war of words between the two intensified.

Markets were also lower in Europe and Asia.

Reuters data show a 22 per cent perceived chance for a rate increase after the Fed's December meeting.

USA stocks have been in retreat since President Donald Trump Tuesday issued a fiery warning to North Korea to halt its nuclear program.

Gold is often seen as a safe haven for investors during uncertain times, such as the heated exchanges between U.S. President Donald Trump and the North Korean regime.

The reclusive state raised the stakes further with a detailed plan to send a salvo of missiles towards the U.S. territory of Guam. And when the S&P 500 breaks a streak of 50+ trading days without a 1%+ up move, the index actually averages a decline over the next month and a gain of just 0.86% over the next three months.

"There's not a great incentive to buy big", said Lerner of SunTrust Advisory.

Data storage company Seagate Technology (STX) posted a standout gain within the hardware sector, jumping by 2.4%.

The Dow Jones Industrial Average dropped 204.69 (nearly one percent), closing the session at 21,844.01.

"Pretty remarkable, perhaps even extraordinary, considering", said Tim Ash, strategist at fund manager BlueBay. The Japanese markets were closed for a holiday. "What's happened in North Korea is enough to do that". Germany's DAX Index fell 0.6 percent, while the UK's FTSE 100 Index retreated 1.2 percent, and France's CAC 40 Index slid 1.4 percent.

"This inflation data for the month was not good".

"If the data continues to come in on the softer side, the market might start to price the Fed staying on hold this year", said Sireen Harajli, FX strategist at Mizuho in NY.

CURRENCIES: The euro slipped 0.1 percent to $1.1176 while the dollar was steady at 109.20 yen.

Sterling was last trading at $1.3007, up 0.25 percent on the day.

Emerging market stocks rose 0.29 percent. Wall Street was expecting more inflation.

Meanwhile, shares of Kraft Heinz rose as the USA food and beverage company, which has struggled with flagging sales, and Oprah Winfrey announced a new line of "four "flavourful soups and four savoury sides" under the name O, That's Good! as part of a previously-announced partnership between the two".

Bond prices were little changed.

The 10-year notes US10YT=RR last fell 3/32 in price to yield 2.2655 percent, from 2.257 percent late on Monday. Crude briefly pared losses in late trading after USA inventories fell more than expected last week.

US crude oil futures settled almost 2 percent lower at $48.59 a barrel, as Russian Federation considered a future output resumption and the Organization of the Petroleum Exporting Countries boosted its July production numbers.

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