Wall Street Records Losses After Trump's North Korea Warning

Xavier Trudeau
Août 13, 2017

Oil also regained momentum as data pointed to declining USA inventories.

Investors, who took the North Korea report from Japan in their stride earlier in the day, lost their appetite for risk after Trump's comments to reporters during his vacation at his golf club in New Jersey.

Guam which is more than 3,000 km (2,000 miles) to the southeast of North Korea, is home to about 163,000 people and a U.S. Navy base that includes a submarine squadron and a Coast Guard group, and an air base.

The remarks followed a new report asserting that USA intelligence has assessed that Pyongyang has successfully produced a nuclear warhead that can fit inside its missiles. "Safe havens are bid and markets are a little uneasy".

The euro edged down 0.1 percent to $1.1735. Only three out of 30 Dow components finished higher.

The S&P 500 .SPX lost 5.99 points, or 0.24 percent, to close at 2,474.92 and the Nasdaq Composite .IXIC dropped 13.31 points, or 0.21 percent, to 6,370.46.

The South Korean won sank around 0.8 percent to 1,133.8 to the dollar, its lowest since July 14.

With Asian bourses and USA stock futures weakening early on Wednesday, the safe-haven 10-year Treasury yield was last down 3 basis points. The index has fallen to its lowest intraday level in well over a month.

"The market had been complacent for a while regarding headlines from North Korea".

The Nikkei slumped to its lowest close for nearly three months Wednesday, leading an Asia-wide sell-off sparked by President Donald Trump's apocalyptic warning over North Korea's weapons programme.

"Japanese equities hadn't been rising much despite positive earnings results, so investors had started jumping at shadows, doubting whether they should really be holdings onto Japanese stocks".

Shares of Michael Kors KORS.N ended up 21.5 percent, after the luxury goods maker raised its full-year revenue forecast.

Spot gold added 1 percent to $1,272.83 an ounce.

Health care equipment and services company Henry Schein declined amid a broader slide by health care stocks.

Benchmark U.S. crude fell 22 cents to $49.17 a barrel on the New York Mercantile Exchange. Brent crude, used to price worldwide oils, declined 23 cents to $51.67 per barrel in London. Gold gained 0.54 percent to $1,266 an ounce, but that is only its highest in less than a week. Copper rose 4 cents to $2.94 a pound. It was last up 1 percent at 1.133 per euro.

Markets overseas were mixed Tuesday.

Economists polled by MarketWatch had expected the government to report that initial claims for regular state unemployment-insurance benefits rose 2,000 to 242,000. Britain's FTSE 100 added 0.1 percent.

In overseas trading, stock markets across the Asia-Pacific region saw further downside during trading on Thursday.

The Australian dollar, sensitive to shifts in risk sentiment, was down 0.5 percent at $0.7876. The common currency had lost about 0.4 percent overnight after news US job openings surged to a record in June reinforced Friday's robust payrolls data and supported the greenback.

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